Appendix — Saudi v. Marine Transport Lines, Inc.
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Appendix A
In the
"™ited States Court of Appeals
for the Fifth Circuit
DECEMBER 1, 2003
No 02-20235
CAPTAIN SHERIFF SAUDI,
Plaintiff-Appellant,
VERSUS
S/T MARINE ATLANTIC, ETC., ETAL.,
Defendants,
MARINE TRANSPORT LINES, INC.,
OWNER/MANAGER OF THE VESSEL “MARINE ATLAN-
Tic’:
MARINE TRANSPORT CORPORATION,
OWNER/MANAGER OF THE VESSEL “MARINE ATLAN-
=.”
Defendants-Appellees.
* eK KK KK KK KK KK OK OK OK OK K
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N° 02-20563
CAPTAIN SHERIFF SAUDI,
Plaintiff-Appellant,
VERSUS
S/T MARINE ATLANTIC, ETC., ETAL.,
Defendants,
MARINE ATLANTIC LTD.; ACOMARIT
SERVICES MARITIME, S.A.;
OSPREY ACOMERIT SHIP MANAGEMENT, INC.;
KOCH SHIPPING, INC.; KOCH SUPPLY AND
TRADING COMPANY,
Defendants-Appellees.
Appeals from the United States District Court
for the Southern District of Texas
N° H-99-CV-2367
Before SMITH, BARKSDALE, and CLEMENT,
AFFIRMED. See 5TH Cir. R. 47.6.
Circuit Judges.
PER CURIAM:*
* Pursuant to STH Cir.- R- +7.5, the court has deter-
mined that this opinion shor .4 not be published and
is not precedent except under the limited circum-
stances set forth in STH Cir. R 47.5.4.
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-~
Appendix B
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
Civil Action No. H-99-2367
CAPTAIN SHERIFF SAUDI,
Plainuff
VS.
S/T MARINE ATLANTIC, Her Equipment and Appurtenances,
In Rem (a/k/a M/V Marine Atlantic, Her Equipment and
Appurtenances, In Rem, a/k/a MIT Marine Atlantic, Her
Equipment and Appurtenances, In Rem), MARINE ATLANTIC,
LTD., JOHN DOE COMPANY, Owner of the Vessel Marine
Atlantic. ACOMARIT SERVICES MARITIMES, S.A.,
OSPREY ACOMARIT SHIP MANAGEMENT, INC.,
VALMET- APPLETON, INC., APPLETON MACHINES CO.
(Appleton Marine Division), APPLETON MACHINE CO.,
INC., APPLETON MARINE, INC., JOHN DOE
COMPANY, Designer of the Crane, KOCH PETROLEUM
| GROUP, L. P., JURONG SHIPYARD, LTD. AND UNITED
STATES TATES TRUST COMPANY OF NEW YORK,
Defendants
FINAL JUDGMENT PURSUANT TO FED. R. CIV. P. 54(b)
Pursuant to the Court’s memorandum and order of September
15, 2000 (#222), granting summary judgment in favor of Defen-
dants Koch Shipping Inc. and Koch Supply & Trading Company
Ltd. n/k/a Koch Petroleum Group, L.P., and its memorandum and
order of February 20, 2001, granting summary judgment (#264) in
favor of Defendant Osprey Ship Management, Inc., and because
the Court finds no just reason for delay, the Court hereby
ORDERS that the Clerk of the Court shali enter FINAL
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SUMMARY JUDGM®)\T in favor of Defendants Koch Shipping
Inc., Koch Supply & 7 ading Company Ltd. n/k/a Koch Petroleum
Group, L. P., and Os:srey Ship Management, Inc. against Plaintiff
Captain Sheriff Saudi on all claims against these Defendants, pursu-
ant to Fed. R. of Civ. P. 54 (b) .' Plaintiff shall take nothing and shall
bear all costs of court.
THIS IS AFINAL JUDGMENT.
SIGNED at Houston, Texas, this 10th day of April, 2002.
MELINDA HARMON
STATES DISTRICT JUDGE
' The Court dismissed the following parties without prejudice for lack of
personal jurisdiction: Acomarit Services Maritimes, S.A. (#44, January 31, 2000);
Appleton Marine Inc. and Appleton Machine Company, Inc. (#159, August 31,
2000, finalized #183, October 17, 2000); and Marine Atlantic Ltd. (#237, December
21, 2000). These dismissals were final when the orders were entered, should there be
any question of finality with respect to Captain Saudi’s appeal of the Court’s gntry
of final judgment on partial findings pursuant to Fed. R. Civ. P. 52(c) in favor of
Defendants Marine Transport Lines, Inc. and Marine Transport Corporation against
Plaintiff on all claims that Captain Saudi asserted against these Defendants (#310 &
311, January 24, 2001).
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Appendix C
IN THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION
CIVIL ACTION NO. H-99-2367
CAPTAIN SHERIFF SAUDI
Plainuff
VS.
S/T MARINE ATLANTIC, Her Equipment and
Appurtenances, In Rem (a/k/a M/V Marine Atlantic, Her
Equipment and Appurtenances, In Rem, a/k/a M/T Marine
Atlantic, Her Equipment and Appurtenances, In Rem), MA-
RINE ATLANTIC, LTD.,. JOHN DOE COMPANY, Owner
ofthe Vessel Marine Atlantic. ACOMARIT SERVICES
MARITIMES, S S.A., OSPREY ACOMARIT SHIP MAN-
AGEMENT., INC., VALMET- APPLETON, INC..
APPLETON MACHINES Co. (Appleton Marine Division), S.
APPLETON MACHINE CO., INC., APPLETON MARINE.,
INC., JOHN DOE COMPANY, Designer of the Crane,
KOCH SUPPLY AND TRADING GROUP, N/K/AKOCH
PETROLEUM GROUP, LL. P. MARINE TRANSPORT
LINES, INC., MARINE TRANSPORT CORPORATION.
JURONG” SHIPYARD, LTD.. AND UNITED STATES
TRUST COMPANY OF NEW YORK,
Defendants
RULE 54(b) FINAL JUDGMENT
Pursuant to the findings of fact and conclusions of law issued by
this Court on this date in support of its oral Rule 52 (c) judgment on
partial findings at trial on January 10, 2002, the Court
ORDERS that FINAL JUDGMENT Is GRANTED in favor of
Defendants Marine Transport Lines, Inc. and Marine Transport Cor-
poration on all claims asserted against them by Plaintiff
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Captain Sheriff Saudi. Plaintiff shall take nothing and shall bear all
costs of court.
THIS ISA FINAL JUDGMENT. SIGNED at Houston, Texas,
this 24th day of January, 2002.
MELINDA HARMON
UNITED STATES DISTRICT JUDGE
Ta
Appendix D
IN THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION
) CIVIL ACTION NO. H-99-2367
CAPTAIN SHERIFF SAUDI,
Plainuff
VS.
CIVIL ACTION NO. H-99-2367 S/T MARINE ATLAN-
TIC, Her Equipment and Appurtenances, In Rem (a/k/a M/V
Marine Atlantic, Her Equipment and Appurtenances, In Rem,
a/k/a M/T Marine Atlantic, Her Equipment and Appurtenances
In Rem), MARINE ATLANTIC, LTD., JOHN DOE COM-
| PANY, Owner of the Vessel Marine Atlantic, ACOMARIT
| SERVICES MARITIMES, S.A., OSPREY ACOMARIT SHIP
) MANAGEMENT, INC., VALMET- APPLETON, INC.,
| APPLETON MACHINE CO. (Appleton Marine Division),
APPLETON MACHINE CO., INC., APPLETON MARINE,
INC., JOHN DOE ’ COMPANY, Designer of the Crane,
KOCH SUPPLY AND TRADING GROUP, N/K/A KOCH
PETROLEUM GROUP, L.P. MARINE TRANSPORT LINES,
INC., MARINE TRANSPORT CORPORATION. JURONG
SHIPYARD, LTD. AND UNITED STATES TRUST COM-
PANY OF NEW YORK,
Defendants
b]
FINDINGS OF FACT AND CONCLUSIONS OF LAW
SUPPORTING RULE 52(c) JUDGMENT ON PARTIAL
FINDINGS
In the above referenced personal injury/products liability action
in admiralty, Plaintiff Captain Sheriff Saudi’s (“Plaintiff’s” or
“Saudi’s’’) claims against marine Transport Lines, Inc. (“MTL”) and
Marine Transport Corporation (“MTC”) were tried to
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the bench on January 7-10, 2002.' After Plaintiff rested, Defen-
dants orally moved for judgment on partial findings under Federal
Rule of Civil Procedure 52(c), and the Court granted the motion.
Plaintiff was accorded the opportunity to file a post-trial brief by
January 17, 2001, but failed to do so. Therefore the Court now
issues the following findings of fact and conclusions of law support-
ing its ruling.
FINDINGS OF FACT
On May 17, 1999, the date of the accident at issue in this case,
Captain Sheriff Saudi (“Saudi”) was employed by American
' MTL and MTC were the only Defendants remaining that appeared for trial.
On May 17, 2000 the Court granted Plaintiff's motion for default judgment (#91)
against Jurong Shipyard, Ltd., but reserved the question of its unliquidated damages
for trial, where it did not appear. On January 31, 2000 (#44), it granted Acomarit
Services Maritimes, S.A.’s motion to dismiss for lack of jurisdiction. On March 3,
2000 Defendant Koch Petroleum Group L.P. was dismissed without prejudice when
the Court granted Saudi’s motion to nonsuit that entity (#62). After allowing sub-
stantial time for discovery, on September 5, 2000, the Court granted Appleton
Marine Inc. and Appleton Machine Company, Inc.'s (“the Appleton Defendants”’)
renewed motion to dismiss for lack of personal jurisdiction and United States Trust
Company of New York’s (“U.S. Trust’s”) motion for summary judgment (#159).
The Appleton Defendants’ dismissal was finalized on October 17, 2000 (#183),
while a Rule 54(b) final summary judgment in favor of U.S. Trust was entered on
December 19, 2000 (#230). Pursuant to a stipulation of all parties, Valmet, Inc. was
dismissed on October 26, 2000 (#186). On December 15, 2000, the Court granted
Koch Shipping, Inc. and Koch Supply & Trading Company, Ltd. n/k/a Koch Petro-
leum Group, L.P.’s motion for summary judgment (#222). On December 21, 2000,
the Court dismissed Marine Atlantic Ltd. for lack of personal jurisdiction (#237) .
Finally, on February 20, 2001, the Court granted osprey Ship Management, Inc.'s
motion for summary judgment (#264).
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Eagle Tankers.’ Koch Petroleum Group L.P. (“Koch”) had char-
tered the ST MARINE ATLANTIC from its owner, Marine Atlan-
tic Ltd. American Eagle Tankers, in accordance with a contract it
had with Koch, had furnished Saudi, an experienced mooring mas-
ter and a licensed mariner, who was acting in that capacity during
the traditional maritime activity ofa lightering operation, to help in
lightering operations involving the ST MARINE ATLANTIC in navi-
gable international waters of the Gulf of Mexico. Saudi was being
transferred from the ST MARINE ATLANTIC to a small tender
vessel, the M/V AMERICAN DISCOVERY, in a personnel bas-
ket by means of a portside cargo hose crane affixed to the ST
MARINE ATLANTIC, when a splined-shaft coupling between the
motor/brake unit and the luffing winch in that crane failed. Up until
that time, there was no indication of any problems in the splined
shaft couplings in any of the cargo hose handling cranes on the ST
MARINE ATLANTIC or its sister ship, the ST MARINE PA-
CIFIC.’ Because of the failure of the ST MARINE ATLANTIC’s
portside crane’s coupling, the crane collapsed, dropping Saudi and
the basket about fifty feet into the water, and the crane and its wires
fell on top of him and severely injured him.
In determining whether MTL and/or MTC is liable, the Court
examined the history of the vessel up to the time of the
* American Eagle Tankers was never a party to this suit.
‘There was evidence that a hydraulic motor on the starboard crane failed in the
fall of 1995, but there was no evidence that it had anything to do with the splined
shaft coupling at issue here.
accident.
The ST MARINE ATLANTIC was originally known as the
UST ATLANTIC, although none of the witnesses at trial was cer-
tain of, nor did the documentary evidence explain, the reason. A
crude oil carrier that is still one of the largest in the world, the vessel
was built under full survey to meet the rules of the American Bureau
of Shipping (““ABS”)* by the Newport News Shipbuilding and Dry-
Dock Company (“Newport News’) in Newport News, Virginia.
Richard Farman, MTL’s Technical Director during the relevant pe-
riod, testified that the vessel was originally built under the auspices
of the United States Coast Guard to 21! under the United States
flag. Greg Doyle, chartering manager for MTL International Ship
Management, Inc. (“ISM”), to be discussed infra, stated that the
designs of the cranes constructed for the vessel were submitted to
the United States Coast Guard and approved.
During construction Newport News installed two cargo hose
handling cranes, designed and manufactured by Appleton Marine
Division of the Appleton Machine Company of Appleton, Wiscon-
sin, manual, a copy of which was kept on the vessel. Defs.’ Ex. 30.
* As reflected in the record and the trial evidence, the ABS develops rules,
standards and guidelines for the design, construction, and operational maintenance of
vessels, provides classification services, and keeps records for vessels “in class.” A
classification by ABS reflects that a vessel is structurally and mechanically fit for a
particular use or service according te ABS’ rules and standards. Insurance companies
generally require such classification before insuring a vessel and major oil companies,
before chartering it for use. After its construction, the vessel in dispute here was
classified by the ABS as 11+A1 (E) Oil Carrier.” .
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The cranes, one mounted on the starboard side and one or. the
port side of the vessel, were each rated as having the capacity to
bear fifteen metric tons safely. The vessel was delivered by New-
port News to iis original owner, most likely the Shell Oil Company
or one of its affiliates, in 1979 and was first managed by the
Interocean Management Corporation (“Interocean”’) of Philadel-
phia, Pennsylvania.
For thirteen years, from approximately August 1981 until July
1994, the vessel was taken o it of service and anchored in Labuan
Bay, on the coast of Sabah, Eastern Malaysia under the care of BP
Shipcare, which is in the business of providing long-term care to
tankers in lay-up. In February 1994, Marine Atlantic Ltd., a Liberian
corporation, purchased the vessel, transferred it from United States
registry to Liberian, and renamed it the ST MARINE ATLANT x.
MTLis a subsidiary of MTC. Defs. Ex. 45, Telefacsimile from
Peter N. Popov, General Counsel of MTC. Around February 15,
1994 ISM,” a special purpose subsidiary of MTL, contracted with
Marine Atlantic Ltd., the new owner of the ST MARINE ATLAN-
TIC, to operate and manage the vessel.
The issue of ownership of the vessel has been implicitly raised
by Plaintiff's suing a large number of Defendants with names con-
taining the word “Marine.” Defendants have argued that the April
1998 edition of the Register of International Shipowning
> ISM was also never sued in this action.
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Groups erroneon'sly indicated that the ST MARINE ATLAN-
TIC and her sister ship, the ST MARINE PACIFIC, were owned
by ISM. Long before the accident at issue here, Peter Popov sent a
letter dated August 13, 1998 to the Register of International
Shipowning Groups and the Tanker Advisory Center to correct the
muisiziformation. Defs.’ Ex. #45. Plaintiff has not controverted the
corrected information presented in that letter, which the Court now
Popov’s letter explains that ISM is an indirect, Liberian subsid-
iary of MTL and was organized in January 1994. In February 1994,
Marine Atlantic Ltd. bought the ST MARINE ATLANTIC, while
Marine Pacific Ltd. purchased the sister vessel, the ST MARINE
PACIFIC. Id.°
Following the purchases of the vessels, ISM took over the tecn-
nical operation of both vessels; MTL International Tankers, Inc.
(another indirect Liberian subsidiary of MTL organized in January
1994) began commercial management of the two vessels; and MTL
assumed the accounting duties. Id. The contract between MTL and
Marine Atlantic Ltd. was terminated by Marine Atlantic Ltd. on
December 12, 1995 (Defs.’ Ex. #51), and ISM stopped operating
and managing the vessel on January 29, 1996, when ISM delivered
the two vesseis to its successor, Acomarit Services Maritimes, S.A.
(“Acomanit’). Ex. 1 to Popov Affidavit. MTL’s accounting duties
° Popov’s letter indicates that the stock of the two purchasers was owned by
Monte Christo Shipholdings, Ltd. On February 16, 1994 MTL acquired a small
minority position in Monte Christo. MTL sold that stock on March 21, 1996 and
has since had no interest in Monte Christo, Marine Atlantic Ltd., Marine Pacific
Ltd., or either of the sister vessels.
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with respect to the ST MARINE ATLANTIC ended several months
after the vessels were delivered to Acomarit, three years before
Saudi’s injury on May 17, 1999. Popov states that at the time he
was writing the letter, Acomarit was the technical manager of both
ships, and Defendants’ counsel currently represents that it still is;
Salisbury House, Inc. of Brookline, Massachusetts was performing
the commerciai management; Marine Atlantic Ltd. continued to own
the ST MARINE ATLANTIC ; and Marine Pacific Ltd. continued
to own the ST MARINE PACIFIC. Id.’
The evidence at trial showed that while the ST MARINE AT-
LANTIC was anchored in Labuan Bay, qualified representatives of
MTL and ISM visited the vessel and prepared a “reactivation speci-
fication” to identify what would have to be done to bring the vessel
up to trading standards and to determine if reactivation would be
worthwhile. Richard Farman was among those hired by MTL to
inspect the vessel for possible reactivation, and he testified from
personal knowledge about the evaluation process. Because there
was little prior history for the vessel, since it had only operated from
1979-81 before being deactivated for thirteen years, to insure that
the reactivation specifications would encompass all
’ Moreover, in the course of this litigation Marine Atlantic Ltd. came forward
identified itself as the owner of the ST MARINE ATLANTIC at the relevant times.
That admission was the basis for the summary judgment granted in favor of U.S.
Trust Company of New York (#159 and 230), which Plaintiff had sued apparently
because the vessel was initially known as the UST Atlantic. When Plaintiff contin-
ued to pursue and harass U.S. Trust Company of New York without any showing of
objective evidence to support his suit, this Court imposed monetary sanciivris on
Plaintiff.
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necessary refurbishment, they investigated the following available
sources of information. The MTL and ISM representatives asked
the initial vessei manager, Interocean, and caretaker during deacti-
vation, BP Shipcare, if they were aware of any problems in connec-
tion with the operation and use of the cranes and of any mainte-
nance done on the cranes. They reviewed all reports generated by
BP Shipcare to identify any problems or faults. Moreover, because
the sister vessel, ST MARINE PACIFIC, had been reactivated
eighteen months earlier, they reviewed all records of problems it
had experienced to be included in reactivation work on the ST
MARINE ATLANTIC. Defs.’ Ex. 25. They also reviewed the crane
manual for specific information about inspection, maintenance, and
lubrication required for the cranes.
Significantly, the crane manual did not verbally mention the
splined-shaft coupling in dispute here; the only “reference” to t was
its inclusion as a part of the crane in a single diagram and its identi-
fication as a coupling in the index. Moreover, as reflected in the
evidence, because of the design of the crane, the coupling was not
immediately nor easily visible; it was hidden behind a bolted metal
plate. Even if the plate were removed, to inspect the four-inch-long,
two-to-three-inch-diameter coupling in the crane, one would have
to remove the splined shafts from it by unbolting and removing sub-
stantial parts or all of the luffing winch assembly on one side or of
the motor/brake assembly on the other. Even if it had been exposed
to view, the coupling, itself, gave no notice that lubrication might be
needed: it was designed
lSa
and installed without a grease fitting or nipple or any other device
that would permit lubrication of the inside of the coupling where it
touches the splined shafts. The design also did not suggest there
were moving parts within the coupling. In fact, Richard Farman,
MTL’s very knowledgeable Technical Director, credibly testified
that the coupling was not designed tv inove, but was designed to be
locked in position and have no friction within it. He stated that it was
designed to act as one with the shaft and not to have internal moving
parts or require lubrication. That information was not controverted
by any evidence submitted by Plaintiff. Nor did the crane manual
instruct that the coupling needed periodic inspection, lubrication, or
any G. er type of maintenance. Indeed there is no evidence that
anyone knew of the existence of or location of the coupling or of the
need for maintaining it before Saudi’s accident on May 17, 1999,
nor is there any evidence of any other such coupling failing in similar
cranes from the same manufacturer.* Indeed all the evidence sug-
gests that the failure of the coupling was an unpredictable freak
accident.
In sum there was no history or indication from Interocean, BP
Shipcare, the sister ship ST PACIFIC MARINE, the operating his-
tory of the ST MARINE ATLANTIC, the manual, or the
* Greg Doyle testified that normally a vessel repairman relies on the
manufacturer’s manual for maintenance instruction. He corroborated Farman’s testi-
mony that neither the manual nor the design nor any problem with the equipment
alerted the reactivators to a need for maintenance of the coupling.
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design of the coupling that the splined-shaft coupling was a source
of any problems that should have alerted anyone to inspect, modify,
service, or maintain the coupling either during the reactivation nor
afterward, prior to Saudi’s accident.
After bids were solicited from shipyards in Southeast Asia, the
reactivation contract was awarded to Keppel Shipyard, a division
of Keppel Corporation Ltd. (““Keppel’”),’ and the ST MARINE
ATLANTIC was towed to Keppel’s Singapore shipyard for the
work. Richard Farman, with his substantial experience, described
Singapore as “probably the premier ship repair port in the world”
and Keppel as “the number one or two” shipyard there. The
drydocking and reactivation took approximately seven months, from
July 1994 until January 1995, ata cost of several million dollars.
Keppel and its subcontractors inter alia made numerous modi-
fications and refurbished substantial parts of the vessel, including
installation of a new incinerator, crude oil washing machines, tank-
level gauging and temperature monitors, valve remote systems in-
volving the refurbishment of more than ten miles of hydraulic tubing,
remote pressure monitoring for cargo system, an alarm monitoring
system, boiler management system, scrubbing tower, antifouling sys-
tem, retrofit of inert gas system, boiler tube modifications, adding
underwater hull markings, hull repair, modification of the distilled
water tank, shaft seal changes, and boiler heater fabrication.
° Keppel has not been sued in this action.
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During the reactivation, the owner, Marine Atlantic Ltd., paid
three independent contractors, who were not employees of ISM or
MTL, to function as Marine Atlantic Ltd.’s representatives to moni-
tor the reactivation to insure that the work performed was accord-
ing to specification and appropriate standards and that it was prop-
erly and timely accomplished. The three representatives did not
| perform any hands-on work in any of the modifications, replace-
ments, and repairs during the reactivation, but met daily with Keppel
managers, observed the work being performed, and assessed
whether the charges were appropriate. They could also authorize
additional work beyond that specified in the reactivation contract if
the need arose, but no evidence was presented that they did. These
three independent contractors reported daily to MTL’s Richard
Farman, who testified that he was responsible for managing the re-
activation from his office in Weehawken, New Jersey. The three
representatives also sent invoices for their services to MTL, which
arranged for payment from a bank account funded by Marine At-
lantic Ltd.
The very credible testimony of Richard Farman, MTL’s Tech-
nical Director, was the only evidence relevant to the issue of whether
MTL is liable, other than the far less comprehensive testimony of
Greg Doyle, the chartering manager of ISM, which did not contra-
dict Farman’s testimony. Farman explained that because of the re-
activation and the fact that the vessel, newly purchased by Marine
Atlantic Ltd., a Liberian corporation, would be under Liberian reg-
istration and carrying the Liberian flag, certain tests
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and statutory trading certificates were required. These surveys,
i-e., inspections, were not carried out by Liberia, but by classifica-
tion societies that certify that particular inspections have been done.
A vessel cannot carry on trade without such trading certificates in
force. Indeed, the history of inspections of the ST Marine Atlantic
reflects reasonable and prudent care of the vessel under the circum-
stances.
In December 1994, both cargo hose handling cranes were load
tested to 18.75 metric tons (125% of their safe working load of 15
metric tons) by Keppel, as witnessed by an ABS surveyor and one
of the owners’ representatives. Both Keppel and ABS certified the
load test and provided the certificates to MTLin Weehawken, New
Jersey. Defs.’ Ex. #49. The vessel left the Keppel Shipyard and
completed sea trials in January 1995 and was rated “in class.”
The ABS, acting as a classification society and on behalf of
Liberian authorities, conducted regulatory and statutory surveys
throughout the reactivation and issued various certificates, as re-
quired before the ST MARINE ATLANTIC would be able to
trade.'° The ADS performed surveys and inspections of the vessel
in dry docking, a tail-shaft survey, an annual survey of hull, an an-
nual load line inspection, an annual survey of machinery, an annual
survey of automation, an annual survey of inert gas system, a
(0 Richard Farman testified that ABS inspects all critical parts of the vessel, but
it does not require the breaking down of all parts. If a problem is noticed, ¢.g.,
overheating, untoward noises or abnormal movement, the inspector has the discre-
tion to determine whether a breakdown of a particular part or system is needed.
he als «ie Soot.
ne
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special survey of machinery, a special survey of automation, a spe-
cial survey of inert gas system, a port main water tube survey, a
starboard main water tube boiler survey, a gauging report, anda
tonnage confirmation survey. The ABS also performed surveys foi
safety construction, safety equipment, safety radio and international
loadline. It performed a condition assessment survey and rated the
cargo hose handling crane as “Grade 1,” meaning “Condition supe-
rior in all respects; very well maintained; a condition of unimpaired
orginal strength and/or efficiency; no maintenance or repair required.”
Defs.’ Exs. #41, p. 5, item 4 and #31, 46,47, 48.
When the reactivation was nearly completed, Marine Atlantic
Ltd. contracted with Clyde Marine of Glasgow, Scotland to furnish
officers and crew, all employees of Clyde Marine, for the vessel.
Thus the regular maintenance of the vessel in January 1996 became
the responsibility of the chief engineer and officers on the vessel.
Clyde Marine’s invoices were paid from a bank account funded by
Marine Atlantic Ltd.
Furthermore, after Acomarit took over as manager in January
1996, the port cargo hose handling crane on the ST MARINE AT-
LANTIC was load-tested off the United Arab Emirates three times
before Saudi’s accident. In November 1996, it was weight-tested
to 18.20 metric tons under the observation of an ASS surveyor,
who issued a certificate. Defs.’ Ex. 32. In March 1998, both hose
handling cranes were serviced and load tested offshore of Dubai
and ‘the portside crane was load-tested to 18.75 metric tons. Defs’
Ex.
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17, 18. On March 3, 1998 Claymore Security and Safety Consult-
ants issued a certificate attesting to its weight-bearing capacity. Defs.’
Ex. #20. In December 1998 during a special survey and docking
survey of the ST MARINE ATLANTIC in Singapore, both cranes
were load-tested and certified by Jurong Shipyard Ltd., while the
load test was also witnessed and certified by an ABS surveyor.
Defs.’ Exs. 22, 15. In addition, Thomas Garrett, an inspector with a
special interest in cranes, acting on behalf of a major oil company,
performed a vetting inspection aboard the vessel in early 1997 that
included extensive operational tests of both cranes. The manual was
also examined. No substandard condition of the internal mecha-
nisms of the cranes was discovered, nor were there any unusual
noises or vibrations that might have alerted an inspector to the need
for the inspection, maintenance, repair or replacement of any crane
part. Finally, before Koch or an affiliate chartered the vessel, it hired
PacMarine Services of Singapore to conduct an on-hire survey in
January 1999 while the vessel was anchored off Singapore. Defs.’
Ex. 29. The survey specifically reported, “Crane structures noted in
apparent sound condition and both cranes in working condition.”
Id. at 00242.
At tnal Plaintiff produced the clearly corroded coupling, which
was cut apart for removal and damaged in the process, as demon-
strative evidence, as well as a photograph (Plaintiff’s Ex. 90) taken
of it after its removal following the accident. Richard Farman testi-
fied that he believes corrosion caused the crane’s boom arm to fall.
Nevertheless, Plaintiff did
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not demonstrate that the condition of the coupling was dangerous
or required refurbishment or prophylactic maintenance from 1994-
96, the period when MTL had some factual or legal relationship to
the ST MARINE ATLANTIC. Moreover, as Farman credibly ex-
plained, because neither the manual nor the design of the portion of
the crane covering the crane indicated that the coupling existed and
required greasing, and because there was no known problem that
would have alerted the refurbishers to look for it, no maintenance
could reasonably have been expected.'' Farman further observed
that he did not know how one could test it in its normal working
position and condition. Indeed, the coupling had to be cut in half to
remove and inspect it after the accident and it was damaged in the
process.
MTC and MTL owed no legal duty of care to Plaintiff given .the
circumstances of this case. Plaintiffhas failed to show that MTC
had any involvement with the ST MARINE ATLANTIC, no less a
relationship that would have given rise to a duty of care and poten-
tial exposure to liability from Saudi. There is no evidence in the
record that MTL owned, operated or chartered the ST MARINE
ATLANTIC, or that it employed Plaintiff. The evidence demon-
strates that MTL’s limited management role relating to the ST MA-
RINE ATLANTIC on behalf of the owner, Marine Atlantic Ltd.,
related to
'' Farman, the only trial witness knowledgeable about the reactivation and the
design of the crane, stated that he could not tell how much corrosion would have been
present in 1994. He further stated that at that time neither he nor anybody else knew
that the coupling existed behind the steel plate and that to the best of his knowledge,
the coupling was not disassembled.
22a
Farman’s management from New Jersey of three independent
contractors at the Keppel Shipyard monitoring reactivation of the
vessel from 1994-96, and to ministerial accounting actions of pay-
ing Marine Atlantic Ltd.’s employees. During reactivation, MTL was
responsible for having invoices from Keppel and from the ST MA-
RINE ATLANTIC’s new officers and crew, provided by Clyde
Marine, paid from accounts funded by Marine Atlantic Ltd. No
MTL employee had any hands-on or physical involvement in the
repairs, modifications, and reactivation of the vessel.
CONCLUSIONS OF LAW
This Court has admiralty or maritime subject matter jurisdiction
over this action under 28 U.S.C. 1333(1), giving federal district
courts “original jurisdiction ... of... [a]ny civil case of admiralty
jurisdiction.” This Court has admiralty jurisdiction over a tort action
where the alleged tort occurred on or over navigable waters and
where the activity giving rise to the incident had a substantial rela-
tionship to traditional maritime activity such that the incident had a
potentially disruptive influence on maritime commerce. Jerome B.
Grubart, Inc. v. Great Lakes Dredge & Dock Co., 513 U.S. 527,
531-32 (1995); Hufnagel v. Omega Service Industries, Inc., 182
F.3d 340, 351-52 (Sth Cir. 1999). Where an injury occurs on navi-
gable waters of the United States because of defective repairs that
were made on land, the matter falls within admiralty jurisdiction.
Todd Shipyards Corp. v. Turbine Service, Inc.., 467 F. Supp. 1257,
1295 (E.D. La. 1978),
23a
aff'd in part, modif’d in part, and rev’d in part, 675 F.2d 401
(Sth Cir. 1982), cert. denied, 459 U.S. 1036 (1982).
Regarding a judgment on partial pleadings, Federal Rule of Civil
Procedure 52(c) provides,
If during a trial without a jury a party has been
fully heard on an issue and the -court finds against
the party on that issue, the court may enter judg-
ment as a matter of law against that party with
respect to a claim or defense that cannot under the
controlling law be maintained or defeated without a
favorable finding on that issue, or the court may
decline to render any judgment until the close of all
the evidence. Such a judgment shall be supported
by findings of fact and conclusions of law as
required by subdivision (a) or this rule.
The Advisory Committee Notes state, regarding the 1991 Amend-
ment that added (c) to the rule, that “ [i] t authorizes the court to enter
judgment at any time that it can appropriately make a dispositive
| finding of fact on the evidence.” Moreover the notes make clear,
Judgment entered under this rule differs from a
summary judgment under Rule 56 in the nature of
the evaluation made by the court. A judgment on
partial findings is made after the court has heard all
the evidence bearing on the crucial issue of fact,
and the finding is reversible only if the appellate court
finds it to be “clearly erroneous.” A summary judg-
ment, in contrast, is made on the basis of facts es-
tablished on account of the absence of contrary
evidence or presumptions; such establishments of
fact are rulings on questions of law, as provided in
Rule 56(a) and are not shielded by the “clear error’
standard of review.
ee So ea ee Ow ee Pee
The district court need not consider the evidence in a light fa-
vorable to the plaintiff, but instead may issue a judgment in
24a
favor of the defendant if it determines that the plaintiff's evidence is
insufficient to make out a claim. Geddes v. Northwest Missoun State
University, 49 F.3d 426, 429 n.7 (8th Cir. 1995). Furthermore,
when the district court’s findings involve a determination regarding
credibility of a witness, Rule 52 requires “even greater deference
to the trial court’s findings.’” Samson v. Apollo Resources, Inc.,
242 F.3d 629, 632-33 (Sth Cir. 2001 )) quoting Anderson v. City of
Bessemer City. N.C., 470 U.S. 564, 574 (1985)), cert. denied,
122 S. Ct. 63 (2001) . The district court’s findings of fact are re-
viewed for clear error, its conclusions of law are subject to de novo
review, while its evidentiary rulings are reviewed for “abuse of dis-
cretion.” Id.
Admiralty law recognizes causes of action fur negligence and
products liability, including strict liability. East River S.S. Corp. v.
Transamerica Delaval, Inc., 476 U.S. 858, 865 (1986).
The Restatement (Second) of Torts 402A provides as follows
a cause of action for strict products liability:
(1) One who sells any product in a defective
condition unreasonably dangerous to the user or
consumer or to his property is subject to liability for
physical harm thereby caused to the ultimate user
or consumer, or to his property, if (a) the seller is
engaged in the business of selling such a product,
and (b) it is expected to and does reach the user or
consumer without substantial change in the condi-
tion in which it is sold.
Comment (f) to § 402A states, “The rule does the occasional
seller... of products who is not engaged in that
25a
activity as part of his business.”
MTC and MTL are not strictly liable to Saudi for his injuries.
Section 402A is not applicable to MTC and MTL because they
were not sellers of the crane or its coupling and were not engaged in
the business of selling such a product. MTL manages services.
In maritime tort cases, the Fifth Circuit applies general prin-
ciples of, negligence law. Daigle v. Point Landing, Inc., 616 F.2d
825, 827 (Sth Cir. 1980) . Aduty of care may arise under general
maritime law from the application of reasonableness and prudence
to existing circumstances. Coumou v. United States, 107 F.3d 290,
295-96, withdrawn and superseded in part on reh’g, 114 F.3d 64
(Sth Cir. 1997). Anegligence cause of action in admiralty requires a
plaintiff to prove the same elements for negligence as those under
common law: (1) the existence ofa duty of care owed by the defen-
dant to the plaintiff; (2) breach of that duty of care; (3) a causal
connection between the offending conduct and the resulting injury;
and (4) actual injury suffered by the plainuff Thomas J. Schoenbaum,
Admiralty and Maritime Law 5-2 at 170 (3d ed. 2001). In Daigle,
616 F.2d at 827, the Fifth Circuit quoted the following from 57 Am.
Jur.2d Negligence 72 at 423 (1971):
[T]he care which must be exercised in any par-
ticular situation is in proportion to the actor’s knowl-
edge, actual or imputed, of the danger to another in
the act to be performed. The degree of care neces-
sary to constitute the ordinary care required of a
person upon any particular occasion is measured
by reference
26a
to the circumstances of danger and risk known to
such person at the time. ...
Negligence is only actionable ifit is a “legal cause” of the plaintiff's
injuries. Tidewater Manin, Inc. v. Sanco Intern., Inc., 113 F. Supp.2d
987, 998 (E.D. La. 2000), citing Donaghey v. Ocean Drilling Ex-
ploration Co., 974 F.2d 646, 648 (Sth Cir. 1992). ““Legal cause is
something more than ‘but for causation.’” Id., quoting Donaghey,
974 F.2d at 648 (quoting Thomas v. Express Boat Co., Inc., 759
F.2d 444, 448 (Sth Cir. 1985)). Therefore the defendant’s negli-
gence must be a “‘substantial factor” in bringing about -the injury. Id.
“Substantial factor’ m<ans “more than but for the negligence, the
harm would not have resulted.” Id., citing and quoting Chavez v.
Noble Dnilling Corp., 567 F.2d at 289.
The Restatement (Second) of Torts 404, dealing with negli-
gence in making, rebuilding or repairing a chattel, states, “One who
as an independent contractor negligently makes, rebuilds or repairs
a chattel for another is subject to the same liability as that imposed
upon negligent manufacturers of chattels.” Comment (b) of 404
States that “it is not necessary that [the independent contractor’s]
negligence have changed the condition of the chattel for the worse.
It is enough that the chattel because of his negligence is not in that
safe condition in which a competent contractor would have put it
and that it is used, or permitted to be used, in reliance upon the care
and competent [sic] of the contractor.” Regarding liability ofa neg-
higent
27a
manufacturer of a chattel, the Restatement (Second) of Torts 395
provides,
A manufacturer who fails to exercise reason-
able care in the manufacture of a chattel which, un-
less carefully made, he should recognize as involv-
ing an unreasonable risk of causing physical harm
to those who use it for a purpose for which the
manufacturer should expect it to be used and to
those whom he should expect to be endangered by
its probable use, is subject to liability for physical
harm caused to them by its lawful use in a manner
and for a purpose for which it is supplied.
MTC and MTL are not liable as repairers of chattels because
they performed no physical repairs or refurbishment on the ST MA-
RINE ATLANTIC during its reactivation or afterward; rather such
repairs were done by Keppel employees and subcontractors. De-
fendants’ activities did not give rise to manufacturer status.
MTLand MTC are not liable for negligence generally. MTC
was not shown to have any relationship to the ST MARINE AT-
LANTIC that would give rise to a duty of care. MTL owed no duty
of care to Saudi as a manufacturer/repairer relating to reactivation
of the vessel. Had MTL owed a duty of care to Saudi, there is no
evidence that it did not perform those activities for which it was
responsible with reasonable care or that any act or omission by
N.TL proximately caused Saudi’s injuries.
Because “standard commercial practice requires that a trans-
action be predominantly for the sale of goods before the Uniform
Commercial Code (“U.C.C.”) applies, there is a division of opinion
whether an implied warranty of merchantability, U.C.C. §
28a
2-314 (i.e., that every contract for the sale of goods contains an
implied warranty that the goods are not unsafe or otherwise detec-
tive), applies to a contract for services and is cognizable in admi-
ralty. Princess Cruises. Inc. v. General Electric Co., 143 F.3d 828,
832 (4th Cir. 1998), cert. denied, 525 U.S. 982 (1998). The Fourth
Circuit has stated that marine contracts predominantly for services
are not covered by the U.C.C. Little Beaver Enters. v. Humphrey
Rys., 719 F.2d 75, 79 a. 7 (4th Cir. 1983). Although it has-not
directly addressed the issue, the Fifth Circuit in a foomote remarked,
“[1)n construing a contract for services, courts are free to reason by
analogy to [a U.C.C. warranty section).” Princes Cruises, 143 F.3d
at 832, quoting Employers ins. of Wausau v. Suwannee River Spa
Lines, Inc., 866 F.2d 752, 765 n.25 (Sth Cir. 1989), cert. denied,
493 U.S. 820 (1989). Even if the implied warranty of merchant-
ability applies to the services provided by MTL, MTL is not strictly
liable and did not breach an implied warranty of merchantability to
Saudi. MTL has never been a “merchant” in the business of manu-
facturing, selling, or placing in the stream of commerce cranes or
crane parts, including the splined-shaft coupling. Its activities do not
cloak with manufacturer status. Nor has Plaintiff shown that the
coupling was defective when MTL’s relationship with the ST MA-
RINE ATLANTIC ended in 1996 and Acomarit took over man-
agement of the vessel. “‘Res ipsit loquitur, or “the thing speaks for
itself,” is a method to prove negligence by circumstantial evidence.
Ey
29a
Prosser & Keaton On Torts § 39 (5th Cir. 1984). The doctrine
of res ipsa loquitur may apply “when a thing, which cal’ e without
fault of an injured person, is shown to be under the exclusive control
of the defendant, and the injury is such as in the ordinary course of
things does not occur if the one having such control uses proper
car: , affords reasonable evidence, in the absence of an explanation,
that the injury arose from the defendant’s want of care.” Fruge v.
Penrod Drilling Co., 918 F.2d 1163, 1166 (5th Cir. 1990), quoting
San Juan Light & Transit Co. v. Requena, 224 U.S. 89, 98-99
(1912). Under the doctrine, the circumstantial facts may give rise to
an inference of negligence, but do not compel such. Id. at 1166-67.
The doctrine of res ipsa loquitur does not apply to facts sur-
rounding MTL and MTC because the evidence clearly shows that
they did not have exclusive management or control of the ST MA-
RINE ATLANTIC.
MTC anc MTL are not liable to Saudi under theories of strict
liability, negligence, or breach of implied warranty of merchantabil-
ity.
Rule 54(b) provides in relevant part,
When more than one claim for relief is presented in
an action, . . .or when multiple parties are involved,
the Court may direct the entry of final judgment as
to one or more but fewer than all of the claims or
parties only upon an express determination that
there is no just reason for delay and upon an ex-
press direction for entry of judgment.
The Court concludes that there is no just reason for delay and
30a
directs that entry of final judgment be made in favor of MTC and
MTL on all claims asserted against them by Saudi in this suit.
SIGNED at Houston, Texas, this 24th day of January, 2002.
MELINDA HARMON
UNITED STATES DISTRICT JUDGE
| |
Appendix E
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
CIVIL ACTION NO. H-99-2367
CAPTAIN SHERIFF SAUDI,
Plainuff
VS
S/T MARINE ATLANTIC, Her Equipment and Appur-
tenances, In Rem (a/k/a M/V Marine Atlantic, Her Equipment
and Appurtenances, In Rem, a/k/a M/T Marine Atlantic, Her
Equipment and Appurtenances, In Rem), MARINE ATLAN-
TIC, LTD., Cow” JOHN DOE COMPANY, Owner of the
Vessel-Marine Atlantic. ACOMARIT SERVICES MARITIMES,
S.A.. OSPREY ACOMARIT SHIP MANAGEMENT, INC.,
VALMET- APPLETON, INC., APPLETON MACHINES C.
(Appleton Marine Division), 9 APPLETON MACHINE CoO.,
INC., APPLETON MARINE, INC.. JOHN DOE COM-
PANY, Designer of the Crane, KOCH PETROLEUM
GROUP, L. P., JURONG SHIPYARD, LTD. AND UNITED
STATES TRUST COMPANY OF NEW YORK, Defendants
ORDER
Pending before the Court in the above referenced admiralty
and maritime personal injury action, arising from the May 17, 1999
fall of Plaintiff Captain Sheriff Saudi (“‘Plaintiff’ or “‘Saudi’’) from a
lifting basket as he was transferred from the tanker Marine Atlantic
to the M/V American Discovery because of the collapse of an al-
legedly defective portside crane on the tanker Marine Atlantic, are
Plaintiff’s motion to disqualify judge pursuant to 28 U.S.C. 455
(a) (instrument #277) and Defendants
32a
Marine Transport Corporation (“MTC”) and Marine Transport
Lines, Inc.’s (“MTL’s’””) emergency motion regarding Plaintiff's fail-
ure to designate portions of depositions to be used at trial (#283).
Plaintiff's motion to disqualify states that on August 3, 2001, he
accidentally discovered in a Texas Bar Journal a photograph of the
undersigned judge with counsel for the two remaining Defendants in
this action, Innes Mackillop. In that photograph, Mackillop was
identified as the Executive Director of the Garland Walker Chapter
of the Inns of Court, while the undersigned Judge was identified as
the President of that same organization. The motions asserts the
two “have some sort of ongoing relationship” that is “extrinsic” to
the case and apparently “continued for some time during this case
and will be ongoing at the time of the trial.” The motion notes that
neither has disclosed any of their connections. The motion ques-
tions the impartiality of the undersigned judge, especially in light of
the negative rulings and admonishments directed toward Plaintiff in
this case. Plaintiff further questions how many former law clerks of
the undersigned Judge have been hired by or worked for law firms
representing various Defendants in this case. Plaintiff therefore seeks
full disclosure of all connections between Judge Harmon and the
opposing counsel and Defendants who have appeared in this case,
including the employment of Judge Harmon’s former clerks} by the
firms who represented the various Defendants before any ruling is
made on the instant motion. He also charges that “the facts and
record of this case require that Judge Harmon be disqualified and
that- a new Judge be appointed to preside over the disposition of
Saudi’s remaining
—
33a
claims against the remaining Defendants. “
In response, Mr. Mackillop on behalf of MTC and MTL states
that had counsel for Plaintiff conferred with him prior to filing the
motion to disqualify (as is required by Local Rules! Mackillop would
have informed him that the Garland Walker Inn of Court is amem-
ber of the American Inns of Court, a national professional organiza-
tion comprised of over 20,000 state, federal students dedicated to
“foster(ing) excellence in professionalism, ethics, civility, and legal
skills” in an effort “to perfect the quality, availability, and efficiency
of Justice in the United States.” He insists that the membership of a
judge and a lawyer practicing in that judge’s court in such an orga-
nization cannot be the basis of any reasonable and objective ques-
tioning of the judge’s impartiality. He further represents that he is
unaware that he or his firm has ever employed anyone previously
employed by the Court.
Under 28 U.S.C. 455(a), ajudge should recuse herself in
any proceeding in which (her] impartiality might reasonably be ques-
tioned.” Under 28 U.S.C. 455(b) (1) she “shall disqualify” herself
here (she) has a personal bias or prejudice concerning a party...”
A motion for recusal is subject to the discretion of the district judge,
and a denial of that motion is reviewed only for abuse of discretion.
United States v. Anderson, 160 F. 3d 231, 233 (Sth Cir. 1998). “
In order to determine whether a court’s impartiality is reasonably in
question, the objective observer would
34a
question the court’s impartiality.” Republic of Panama v. American
Tobacco Co., Inc., 217 F. 3d 343, 346 (Sth Cir. 2000). quoting
Trust Co. v. N.N.P., 104 F. 3d 1478. 14941 (Sth Cir. 1997) The
purpose of 455 is not merely to prevent actual partiality but to
‘avoid even the appearance of partiality.” United States v. Jordan,
49 F.3d 152, 155 (Sth Cir. 1995).
This Court finds that Plaintiff fails to provide any objective or
reasonable basis for questioning her impartiality in this case. Mutual
membership in the American Inns of Court will not serve that pur-
pose. The fact that some rulings in this action were adverse to Plain-
tiff, without any objective indication that they were based on per-
sonal bias, impartiality or preyudice against Plaintiff, Cannot raise an
appearance of impartiality in the view of any reasonable and objec-
tive person with all the facts. The Court therefore denies the motion
to disqualify.
Defendants’ motion regarding Plaintiff's failure to designate por-
tions of depositions to be used at trial' is based on the Court’s
Procedures, VII.I.3:
Counsel will designate the portion of any deposi-
tion to be read by citing pages and lines in the
Joint Pretrial Order. Objections to those portions
(citing pages and lines) with supporting authority
must be filed at least three business days before
trial; the Court will rule on the objections before
trial commences.
Plaintiff merely stated that “the full deposition” of each of the
nine depositions he intends to offer at trial would be used even
' The Court presumes that the motion was originally styled “emergency” be-
cause of an imminent trial date, but is no longer because a Continuance was granted.
35a
though large portions of them are irrelevant or inappropriate. Such
an improper tactic will result in forcing Defendants to devote sub-
stantial resources to reviewing and preparing objections to volumes
of irrelevant testimony or non-testimony. As a remedy, Defendants
suggest that Plaintiff be prohibited from using the nine depositions
listed in the pretrial order.
In response, after the Court granted the continuance of trial until
January 7, 2002, Plaintiff states that he has designated portions of
the depositions of Captain William Gibbs and Richard Tarman and
that he intends to make further designations closer to trial.
The Court makes clear here that both sides will be required to
comply with its procedures. Because it appears that Plaintiff has
designated some portions of depositions he will use at trial and rep-
resents that he will do so timely with all designated in the pretrial
order, the Court finds that Defendants’ motion is MOOT. Should
the issue arise again, however, Defendants may reurge their motion.
Accordingly, for reasons indicated, the Court
ORDERS that Plaintiff’s motion to disqualify is DENIED and
Defendants’ motion relating Plaintiff's failure to designate portions
of depositions to be used at trial is MOOT.
SIGNED at Houston, Texas, this 8" day of November, 2001.
MELINDA HARMON
UNITED STATES DISTRICT JUDGE
36a
Appendix F
IN THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION
CIVIL ACTION NO. H-99-236-7
CAPTAIN SHERIFF SAUDI,
Plainuff
VS.
S/T MARINE ATLANTIC, Her Equipment and Appurte-
nances, In Rem (a/k/a M/V Marine Atlantic, Her Equipment
and Appurtenances, In Rem, a/k/a M/T Marine Atlantic, Her
Equipment and Appurtenances, In Rem), MARINE ATLAN-
TIC, LTD., JOHN DOE COMPANY, Owner of the Vessel
Marine Atlantic, ACOMARIT SERVICES MARITIMES, S .
A., OSPREY ACOMARIT SHIP United States Courts MAN-
AGEMENT, INC., VALMET- Southern District of Tens
APPLETON, INC., APPLETON MACHINE ENTERED CO.
(Appleton Marine Division), APPLETON MACHINE CO.,
INC., JUL 2 42001 APPLETON MARINE, INC., JOHN
DOE COMPANY, Designer of the Crane, Michael N, Milby,
Clerk of Court KOCH PETROLEUM GROUP, L.P.,
JURONG SHIPYARD, LTD. AND UNITED STATES TRUST
COMPANY OF NEW YORK,
Defendants
MEMORANDUM AND ORDER
Pending before the Court in the above referenced admiralty
and maritime personal injury action, arising from the May 17, 1999
fall of Plaintiff Captain Sheriff Saudi (“Plaintiff” or “Saudi’’) from a
lifting basket as he was transferred from the tanker Marine Atlantic
to the M/V American Discovery because of the collapse of an al-
legedly defective portside crane on the tanker Marine Atlantic, are
the following motions and matters needing a ruling:
37a
(1) Defendants Marine Atlantic Ltd., Osprey
Ship Management (“Osprey”), and Marine Trans-
port Corporation's (““Transport’s”) joint motion to
strike Plaintiff's expert witnesses (instrument #220),
Salah Mahmoud & Captain Sheriff Saudi, United
States Magistrate Judge Frances Stacy’s memo-
randum and recommendation of 1/26/01 (#258) that
Defendants’ motion to strike be granted in part, and
Plaintiff's objections and exceptions to that memo-
randum and recommendation (#262); (2) Plaintiff
Captain Sheriff Saudi’s motion for rehearing (#242)
of the Court’s order granting summary judgment on
Plaintiff's claims for punitive damages (#224); (3)
Joe Alfred Izen, Jr. and Afton Jane Izen’s motion
for rehearing or new trial (#244) on a Rule 54(b)
final judgment, signed on December 19, 2000
(#230) , awarding fees and expenses to Defendant
U.S. Trust Company of New York (“U.S. Trust”)
under 28 U.S.C. 1927, to be paid jointly by
Plaintiff’s attorneys, and Defendant U.S. Trust’s
related motion for sanctions and to strike (#260)
the Izens’ supplement to motion for new trial
38a
(#254) and tal exhibit to their motion (#259) ; (4)
Plaintiff’s motion for rehearing (#245) on order
signed on December 15, 2000 (#222) granting sum-
mary judgment to Defendants Koch Shipping, Inc.
and Koch Supply & Trading Company Ltd. on all
Plaintiff's claims against them; (5) Plaintiff’s motion
for rehearing (#246) of the Court’s memorandum
and order dated December 21, 2000 (#237) dis-
missing Marine Atlantic Ltd. for lack of personal
jurisdiction; (6) Plaintiff’s cross motion for sanc-
tions (#265); and (7) Defendants Acomarit Ser-
vices Maritimes S.A., Marine Atlantic Ltd., and
Osprey Ship Management Inc.’s opposed motion
for entry of final judgment (#266) .
The Court addresses the motions in the same order.
SAUDIS EXPERT WITNESSES
The trial court has discretion under Federal Rule of Evidence
702 to exclude expert evidence, and that decision is
39a
reviewed only for abuse of discretion. Munoz v. Orr, 200 F.3d 291,
299 (Sth Cir. 2000), citing Daubert v. Merrell Dow Pharmacy, Inc.,
509 U.S. 579, 592-93 (1993), and Boyd v. State Farm Ins. Cos.,
158 F.3d 326, 221 (Sth Cir. 1998) (“With respect to expert testi-
mony offered in the summary judgment context, the trial court has
broad discretion to rule on the admissibility of the expert’s evidence
and its ruling must be sustained. unless manifestly erroneous.”). “The
question of admissibility of expert testimony is not. . an issue of
fact, and is reviewable under the abuse of discretion standard.”
General Electric Co. v. Joiner, 522 U.S. 136, 142 ( 1997); see also
Curtis v. M&S Petroleum, Inc., 174 F.3d 661, 667-68 (Sth Cir.
1999). The trial judge must first preliminarily assess “whether the
reasoning or inethodology underlying the testimony is scientifically
valid and . .. whether that reasoning or methodology properly can
be applied to the facts at issue” to be certain of the relevance and
reliability of the evidence. Daubert, 509 U.S. 592-95. The High
Court required the district court to be the “gatekeeper” under Rule
702 to insure that these two requirements of relevance and reliabil-
ity are met. Id. at 2796-97. The Supreme Court identified four,
nonexhaustive factors for the trial judge to consider in determining
reliability—whether it will assist the trier of fact and can be tested,
whether it has been subjected to peer review, the known or poten-
tial error rates and the existence of standards controlling the
technique’s operation, and the extent to which the methodology
40a
or technique employed by the expert is generally accepted in the
scientific community—but warned they do not constitute a defini-
tive checklist. Daubert, 509 U.S. at 593-94.
In Kumho Tire Co., Ltd. v. Carmichael, 526 U.S. 137, 119S.
Ct. 1167, 1174-76 (1999), the Supreme Court extended the
gatekeeping function beyond scientific experts to nonscientific testi-
mony because Rule 702 does not distinguish between “‘scientific”
knowledge and “technical” or “other specialized” testimony, and
underlined that the trial judge “make certain that an expert, whether
basing testimony upon professional studies or personal experience,
employs in the courtroom the same level of intellectual rigor that
characterizes the practice of an expert in the relevant field.” The
Supreme Court made clear that the test for reliability for nonscien-
tific experts is “flexible” and that “‘Daubert’s list of specific factors
neither necessarily nor exclusively applies to all experts or in every
case.” Id.
Defendants Marine Atlantic Ltd., Osprey Ship Management
(“Osprey”’), and Marine Transport Corporation (“Transport”) jointly
moved to strike the opinions of Plaintiff’s experts, Dr. Salah
Mahmoud and Plaintiff, himself. Instrument #220. Specifically,
Mahmoud opined that a December 1998, American Bureau of Ship-
ping (“ABS”), 50,000-pound-load test of the crane in issue could
not have been performed, or could not have been performed and
passed as documented, in December 1998 because the crane would
not have failed in may 1999, when the aggregate weight of Saudi,
his
4la
personal belongings, and his radio equipment was no more than
250 pounds, if the crane had been so tested and passed. In finding
that Mahmoud’s “expert” opinion was inadmissible under Fed. R.
EVID. 702,' Magistrate Judge Stacy characterized Mahmoud’s con-
clusion as “pure speculation” because M2hmoud admittedly was
not present’ at the stated time of the test, nor did he present any
facts or data to support his conclusion.} She further found that
Mahmoud also failed to address, no less explain, why nothing else
that occurred during the six months between the ABS survey
' Before December 1, 2000, Fed. Rule of EVID. 702 stated, “If scientific,
technical, or other specialized knowledge will assist the trier of fact to understand the
evidence or determine a fact in issue, a witness qualified as an expert by knowledge,
skill, experience, training, or education, may testify thereto in the form of an opinion
or otherwise.”
Rule 702 was amended as of December 1, 2001 and made applicable to pending
cases by order of the Supreme Court “insofar as is just and practicable.” The revised
rule provides,
If scientific, technical or other specialized knowledge will
assist the trier of fact to understand the evidence or to determine
a fact in issue, a witness qualified as an expert by knowledge,
skill, experience, training, or education, may testify thereto in
the form of an opinion or otherwise, if (1) the testimony is based
on sufficient facts or data, (2) the testimony is the product of
reliable principles and methods, and (3) the witness has applied
the principles and methods reliably to the facts of the case.
* Mahmoud’s deposition, Ex. 2 to motion to strike, at p. 45, 11. 3-14
* Mahmoud admitted that he had no evidence or first-hand knowledge that the
load test cocumentation had been falsified, but merely insisted such falsification
“was possible.” Ex. 2 to motion to strike at p. 46, 1.22—p. 47, 1. 22
42a
and the crane failure could have not have caused or contributed to
that failure. Mahmoud also gave his opinion about the rate of corro-
sion of the teeth on two spline gears (to the point where they could
no longer support the load on the crane) based on his unsupported
belief that the crane was submerged in salt water. He applied a
corrosion rate for metal submerged in saltwater, even though there
was no evidence that the crane had ever been submerged. There-
fore the magistrate judge found that his opinion rested on insufficient
facts and data_ She further determined that his deposition demon-
strated that he was not qualified to offer opinions on crane mainte-
nance and inspection requirements. She emphasized that Mahmoud
had had ne training or experience in the inspection of cranes and
was generally unaware of rules, regulations and industry standards’
governing the maintenance and inspection of cranes. Lastly,
Mahmoud determined that the amount o* corrosion on two spline
gears, from the difference in length of existing (or intact) teeth and
the worn teeth on the gears, was .21 to .25 inches. Although Mag-
istrate Judge Stacy found that Mahmoud had not calibrated the
equipment he had used to measure the crane parts at issue and did
not know the original diameters of the two gears, she did not strike
his opinion as to the amount of corrosion on the two spline gears.
Saudi claimed to be an expert in the following seven areas: (1)
the inspection of cranes, (2) the load testing of cranes, (3) appli-
cable standards, rules and regulations regarding
ee ,
43a
crane inspections, (4) applicable standards, rules and regulations
regarding load testing, (5) applicable standards, rules and regula-
tions regarding quadrennial inspection of cranes, (6) classification
society standards, including those of the ABS, Det Norske Veritas
(“DNV”), and Lloyd’s of London (“Lloyd’s”), for inspection of
cranes, and (7) the duties, responsibilities, and the standard of care
applicable to the refurbishing of vessels. After reviewing his deposi-
tion testimony,‘ Magistrate Judge Stacy found that it conclusively
demonstrated that Saudi had no training, experience or personal
knowledge that would qualify him as an expert in crane inspection,
load inspections, or applicable rules, regulations and industry stan-
dards for the inspection of cranes and the refurbishment of vessels.
She found that Saudi’s many years of experience as a master of
vessels, mooring master pilot, and instruction pilot did not qualify
him as an expert in crane inspection and maintenance. She therefore
recommended that this Court disallow his expert testimony on (1)
the inspection of cranes, (2) the load testing of cranes, (3) appli-
cable standards, rules and regulations regarding crane inspections,
load testing, and quadrennial inspection of cranes, (4) classification
society standards, including those of ABS, DNV, and Lloyd’s, for
standard of care applicable to the refurbishing of the Marine
* Saudi’s complete deposition testimony was submitted as exhibit 1 to the
motion to strike.
Atlantic.
Saudi has filed objections and exceptions to Magistrate Judge
Stacy’s recommendation that the motion to strike be granted in large
part (#262), along with a new affidavit of Mahmoud.
First, he objects on procedural grounds that the Court is re-
quired to hold an evidentiary hearing at which an expert is given the
opportunity to demonstrate the reliability of the factual and scientific
basis for his proffered opinion. Daubert, v. Merrill Dow Pharma-
ceuticals, 509 U.S. 579 (1993).
This Court concludes that this argument is frivolous. Daubert
does not require a hearing, but instead recognizes that the “inquiry”
required is “‘a flexible one.” Id. at 594-95. In Kumho Tire Co., Ltd.
v. Carmichael, 526 U.S. 137, 142, 152 (1999)(“The trial court
must have . . . latitude in deciding how to test an expert’s reliability,
and to decide whether or when special briefing or other proceed-
ings are needed to investigate reliability, as it enjoys when it decides
whether or not the testimony was from a deposition and the trial
court denied a hearing on the grounds that the record was adequate
for a Daubert inquiry. Numerous appellate courts have held that an
evidentiary hearing is not required under Daubert, but instead at the
discretion of the district court, especially where, as here, there is a
sufficient record consisting of depositions to investigate relevance
and reliability. See, e.q., Greenwell v. Boatwright,
aX
45a
184 F.3d 492, 498 (6th Cir. 1999) ; Oddi v. Ford Motor Co., 234
F.3d 136, 153-55 (3d Cir. 2000), cert. denied, 121 S. Ct. 1357
(2001); United States v. Benavidez-Benavidez, 217 F.3d 720, 724
(9th Cir.), cert. denied, 121 S. Ct. 242 (2000); Goebel v. Denver
and Rio Grande Western R.R. Co., 215 F.3d 1083, 1087 (10th
Cir. 2000).
Substantively, Saudi challenges the magistrate judge’s finding
that there are no data or reliable methodologies to support
Mahmoud’s opinion that the December 1998 ABS survey could
not have occurred. He contends that there was no survey and that
there is no ABS certification to show there was a survey for testing
the portside cargo hose crane. He also asserts that it is undisputed
that gears the size of those in the crane corrode at a known rate if
their stainless steel is exposed to salt water and that such exposure
occurred when the vessel S/T Marine Atlantic was anchored for
thirteen years in Borneo, Indonesia. It is also undisputed that the
meshed teeth and gears of the crane’s spline coupling, which were
supposed to mesh together, spun freely, allowing the crane arm to
collapse. He argues that to the extent that the magistrate judge shifts
the burden to Plaintiff or Plaintiff’s expert of disproving the exist-
ence of non-negligent causes for the crane’s failure, the magistrate
Judge’s memorandum and recommendation errs. A plaintiff in a neg-
ligence case is not required to disprove the existence of all possible
non-negligent causes for his injury; rather he must prove that negli-
gence was
46a
the most likely cause. Thus Saudi’s experts should not be stricken
because their testimony does not provide proof that Plaintiff is not
required to produce. He submits a new affidavit from Mahmoud to
support this “Exception and objection.”
Next, Saudi insists that Defendants’ claim that Mahmoud based
his corrosion calculations on the belief that the crane was submerged
in salt water is false. The deposition excerpt, at p. 22, 1.24—p. 25,
1.25. demonstrates that Mahmoud said that the crane’s metal was
“exposed,” not “submerged” and distinguished the two terms.
Mahmoud then continued to explain that the rate of corrosion was
affected by the velocity of salt water moving across the corroding
surface. Id. at p. 24, 11. 1—p. 25, 1. 12. Again he refers to
Mahmoud’s newly submitted affidavit for support.
Third, the magistrate judge’s finding that Mahmoud’s deposi-
tion testimony demonstrates that he is not qualified to offer opinions
on crane maintenance and inspection requirements is again based
on statements taken out of context, insists Saudi. He argues that just
because Mahmoud has not memorized all the ABS rules and regu-
lations and has not worked for a crane manufacture does not mean
his testimony is unreliable here. If Defendants had properly
remanufactured or refurbished the crane, they would have found
the corrosion in 1994. Saudi emphasizes that Defendants have not
offered and canne? offer an expert opinion that the corrosion oc-
curred in only five months or five years. He insists that proper lubri-
cation to the gears and splines would have
47a
arrested any corrosion and prevented the crane failure. He reiter-
ates that Defendants have admitted that they were unaware of the
existence of the spline coupling and the significance of its exposure
to salt water and that they never performed maintenance or re-
placed the corroded parts. Given these facts, he urges, Mahmoud’s
training and experience are sufficient for a reliable opinion.
Saudi also questions the magistrate judge’s finding that Saudi
was not qualified to testify on the seven designated areas. Saudi
now submits another personal affidavit and a correct copy of the
ABS regulations, as well as a copy of the International, Safety Man-
agement (“ISM”) Code, to support the current objections and ex-
ceptions to the magistrate judge’s memorandum and recommenda-
tion and to show that a master of a vessel or a Mooring Master pilot
must be familiar with these regulatory requirements to safeguard his
vessel and to insure that it is properly documented and certified for
its owners and charterers. Saudi also submits a letter demonstrating
that the SIT Marine Atlantic did not obtain proper accreditation
from ABS due to patent deficiencies in the accreditation applica-
tion, including lack of drawings. Saudi maintains that negligence in
the maintenance of the vessel or its remanufacture is not solely gov-
ered by or determinable by the regulations or protocols of ABS,
Lloyd’s, and other societies.
In response Defendants argue that the exceptions and objec-
tions constitute a late-filed, supplemental response to their
48a
motion to strike that seeks to relitigate issues already decided.”
D ° odants highlight the fact that Saudi had ample time to submit
eyidence supporting his experts’ qualifications and opinions timely,
‘o ask about their opinions during their depositions in the fall of
2000, and to meet the October 2, 2000 deadline to submit expert
reports. Although Defendants filed their motion to strike on Decem-
ber 14, 2000 and Saudi responded on January 8, 2000, he failed to
attach any affidavits to that response, did not request a Daubert
hearing, and did not ask for an extension of time to submit affidavits
or other documents They therefore request the Court to adopt the
magistrate judge’s memorandum and recommendation and to strike
Mahmoud and Saudi as expert witnesses.
Contrary to Saudi’s representations, Defendants insist that they
did not “hoodwink” the Court or cite testimony out of context. Rather,
attached to their motion to strike is a complete copy of the deposi-
tion of Mahmoud and a complete copy of the second day of Saudi’s
deposition testimony, which addressed the expert witness issues.
Defendants contend that the newly submitted affidavits are un-
timely. They are also self-serving and have not been subjected to
cross-examination. Saudi should have asked relevant
’ Actually, Magistrate Stacy’s memorandum and recommendation is exactly
what it is titled, and does not become a decision of the Court unless and until the
Court approves of and adopts her findings and conclusions. Nevertheless, the Court
agrees that the arguments should have been timely presented to her.
ne
49a
questions of these expert witnesses during their depositions to bring
out the information. Because Defendants now do not have an op-
portunity to cross examine the witnesses, Defendants claim they are
prejudiced, especially in light of the fact that the discovery deadline
and the deadline for submitting expert reports have passed, that the
new affidavits are merely efforts to file late expert reports which
Defendants could not review before timely submitting their own ex-
pert reports, and Defendants had already deposed these witnesses.
They move to strike the affidavits attached to Saudi’s objections
and exceptions from the record.
Furthermore, given the lack of logic in refusing to recognize that
any number of events between the test in December 1998 and the
failure of the crane five months later could have contributed to that
collapse, Defendants maintain that the magistrate judge correctly
ruled that there is no reliable basis for Mahmoud’s speculative opin-
ion that the December 1998 weight test did not take place. They
submit a copy of the “Cargo Gear Statement of Fact Survey” for
the Marine Atlantic, dated December 31 1998 and reflecting the
testing was done that month. Ex. 1. Moreover, they insist that
Mahmoud did apply the wrong corrosion rate to the metal coupling
at issue. The portside of the crane was always located on the main
deck of the vessel and was never submerged in salt water. Yet the
following was said during his deposition:
Q. But the rate that you relied upon in your report
was based on the metal being submerged
in seawater?
A. That’s fine, yes.
Ex. 2 to motion to strike, at p. 130, 11. 22-25. The corrosion
graph that he presented at his deposition was entitled, “Effect of
velocity on corrosion of steel by seawater at ambient temperatures.”
Ex. 2 to Defendants’ response (#263). During his deposition his
testimony demonstrates that the graph referred to metal submerged
in salt water:
The graph shows corrosion rates of steel and sea-
water as a function of velocity, if the seawater is
stagnant or moving at whatever speed. As it shows
in the “x” axis and the velocity, the Y axis is corro-
sion rate in mils per year. And as it shows, as the
velocity increases, the corrosion rate increases.
Id. Thus because the testimony about the rate of corrosion is
erroneous, his conclusions about corrosion rates are not reliable.
Mahmoud did not present any proof of corrosion rates other than
those relating to the submersion of metal in salt water.
Moreover, in Mahmoud’s néw affidavit he concedes, “Dr.
Mahmoud never stated he is a crane maintenance expert, nor a
crane inspector.” Defendants find this admission contrary to what
he stated in his expert report (“I am familiar through experience with
the inspection of lifting cranes.’’) and to Saudi’s arguments in his
exceptions and objections. Thus the magistrate judge did not err in
concluding that Mahmoud is not a crane maintenance or inspection
expert, insist Defendants.
They also maintain that the magistrate judge correctly
Sla
concluded that Saudi, himself, was not an €xpert in the areas he
claimed. His new, untimely affidavit, which was not filed as an ex-
pert report nor in opposition to their motion to strike expert wit-
nesses, is self serving and has not been subjected to cross-exami-
of expertise regarding maintenance issues, and he did not mention
these latest opinions. Ex. 1 to motion to strike expert witnesses. His
deposition testimony reveals that he does not have the expertise to
testify about the ABS regulatory requirements despite his arguments
in his exceptions and objections, but relied on what he was told by
ABS surveyors. Ex. | to the motion to strike, p. 252, 11. 8-20,
Saudi further testified that he had never worked for ABS, had never
had formal training in ABS rules and regulations, and could not re-
member the last time he looked at the ABS manual pertaining to
crane inspections and could not remember its title or reference. Id.
at p. 418, 11. 3-11; p. 309, 1, 15—p. 310, 1. 19. He also con-
ceded that he “did not read, really, their regs, explicit specifications
and I cannot claim that lam an expert about it.” Id. at p. 257, 11. 5-
7.
Saudi’s newly submitted affidavit represents that he is an expert
about the International Safety Management (“I SM”) Code; even
though he claimed no such expertise during his deposition, during
which he erroneously calls the ISM the “Internationa!
52a
Safety Measurement” Code, was in the following exchange:
Q. And where does that requirement come from?
A. This is, this is a requirement from, I guess, the
safety measurements of ISM, if] under stand nght,
International Safety Measurement Q. You guess?
A. 1am guessing, yes. | don’t know exactly where
it came from. But I know that there is a certificate
that was not there. Q. But you are not sure what
requires that? A. No, I am not sure which authority
requires that exactly.
Ex. | to the motion to strike, at p. 299, 1. 18—p. 300, 1. 3.
The new affidavit also refers to mairitenance requirements, suggest-
ing Saudi is an expert in that area. Yet during his deposition, the
following was asked:
Q. And you don’t hold yourself out as a crane main-
tenance expert, correct? A. NoI do not. Nol am
not.
Id. at p. 433, 1. 24—p. 434, 1.1.
For these reasons, Defendants ask the Court to deny Plaintiff
relief and uphold the magistrate judge’s recommendations.
The Court has reviewed the record de novo, including the depo-
sition testimony submitted. Based on the record that was before
Magistrate Judge Stacy when she issued her memorandum and rec-
ommendation, the Court fully agrees with her findings and conclu-
sions. Moreover, the Court concurs with Defendants that the new
affidavits should be stricken. Not only would they greatly prejudice
Defendants at this stage of the litigation, but the inconsistencies be-
tween the affidavits and deposition testimony
53a
have not been explained by Plaintiff.° Because the self-serving affi-
davits contradict Saudi’s and Mahmoud’s swom statements during
their depositions, without any explanation, no less a logical or per-
suasive one, the affidavits are incompetent evidence and have not
been considered by the Court in determining whether the expert S
testimony is reliable. S.W.S. Erectors Inc. v. Infax, Inc., 72 F.3d
489, 495 (Sth Cir. 1996); Thurman v. Sears, Roebuck & Co., 952
F.2d 128, 136 n.23 (Sth Cir. 1992); Albertson v. T.J. Stevenson &
Co., 749 F.2d 223 (Sth Cir. 1984) (rejecting sworn statement of
affiant when it contradicted affiant’s earlier deposition testimony).
The Court accordingly overrules Saudi’s objections and exceptions,
adopts the magistrate judge’s findings and conclusions as its own,
and grants Defendants’ motion to strike expert testimony to the ex-
tent indicated.
* Although the motion before the Court is not one for summary judgment, the
same concerns make the evidence here incompetent. Where a plaintiff attempts to
raise a fact issue by relying on statements in his affidavit that contradict his earlier
sworn deposition testimony, the affidavit is not competent evidence and should be
disregarded. S.W.S. Erectors, Inc. v. Infax, Inc., 72 F.3d 489, 495 (Sth Cir. 1996)(“It
is well settled that this court does not allow a party to defeat a motion for summary
judgment using an affidavit which impeaches, without explanation, sworn testi-
mony.”’); Thurman v. Sears, Roebuck & Co., 952 F.2d 128, 136 n.23 (5th Cir. 1992)
(holding that plaintiff's affidavit contradicting his previous deposition could not
defeat defendant’s summary judgment); Perma Research & Dev. Co. v. Singer Co.,
410 F.2d 572, 578 (2d Cir. 1969) (granting summary judgment for defendant, disre-
garding plaintiff’s affidavit because plaintiff had never before made the specific
factual allegations stated in the affidavit, despite having been asked several times
during his deposition to specify the allegations that supported his claim).
54a
MOTIONS FOR REHEARING
The Court next addresses the motions for rehearing.
A. Instrument #242
Plaintiff's moves for rehearing (#242) of the Court’s order
of December 15, 2000 (#224) granting summary judgment to De-
fendants Marine Atlantic, Ltd., Osprey Ship Management
(“Osprey”), Marine Transport Corporation (“MTC”), Marine Trans-
port Lines,. Inc. (MTL”), and Koch Shipping, Inc. (“Koch”) on
Plaintiff’s claims for punitive damages (#224), which the Court con-
cluded are not recoverable against Defendants under maritime law.
Saudi argues that punitive damages are allowed and are supported
by factual evidence of gross negiigence or intentional conduct. To
establish the applicability of punitive damages here, he refers to the
testimony of Richard Farman, involved in the remanufacture /refur-
bishing of a portside hose handling the crane, who never broke the
crane down to inspect all of its pieces before releasing it for use by
the owners or managers of the S/T Marine Atlantic as
remanufactured/refurbished; to “new evidence” from the deposition
of Osprey Acomarit Services Maritimes, S.A. ‘s (“Osprey-
Acomarit’s”) employee, Tom Garrett, that Osprey-Acomanit failed
to lubricate properly the spline and coupling on the crane, even
though there was a diagram of the crane ini & . on-board manual in
the Chief Engineer’s office; and to Dr. Salah Mahmoud’s affidavit
and deposition testimony stating that the lifting survey that allegedly
occurred in December 1998 (five months before the crane
55a
failed while lifting Plaintiff) was never performed. Saudi also alleges
that the Marine Atlantic, Ltd. crew failed to monitor that test to
make sure that it was carried out. He charges that Defendants dis-
played “conscious disregard” for proper maintenance, supporting a
finding of gross negligence. Saudi relies on In re: Amtrack Sunset
Ltd. Train Crash, 121 F.3d 1421, 1429 (11th Cir. 1997) (holding
that “personal injury claimants have no claim for non-pecuniary dam-
ages such as . . punitive damages, except in exceptional circum-
stances such as willful failure to furnish maintenance and cure to a
seaman, intentional denial of a vessel owner to furnish a seaworthy
vessel to a seaman, and in those very rare situations of intentional
musconduct.’’).
In response, incorporating their earlier pleadings, Defendants
note that the motion is inherently defective because it fails to include
any Ot the evidence it references. Providing an excerpt of Tom
Garrett’s deposition, moreover, Defendants controvert Saudi’s al-
legation that they consciously disregarded the lubrication of the spline
gears and coupling by pointing out that Garrett testified that he as-
sumed that there was a solid shaft through the area in question and,
from his recollection after reviewing the manual in 1997, that there
was no reason to believe that a spine coupling was hidden under the
plating or that the coupling required maintenance of any kind. Ex. 1,
p. 218, 11. 8-15; p. 274, 11. S—p. 275, 1.3. Garrett also stated
that the service manual did not indicate that any service mainte-
nance or
56a
inspection was required for this coupling. Id. at p. 284, 11. 6 14.
Furthermore, Garrett had no recollection of any specific require-
ments in the manual for lubricating a spline shaft for the crane at
issue. Id. at 289, 11. 20-22. Although Plaintiff’s purported expert,
Salah Mahmoud, testified that the crane manual “‘speils out every-
thing that needs to be done in terms of maintenance (ex. 2 at p. 55,
11. 14-21),” the “Instruction, Operation & Maintenance Manual”
prepared by Appleton Marine does not refer to lubrication or in-
spection of the spline coupling as part of any maintenance require-
ment. Ex. 3. Moreover, MTL’s representative, Richard Farman,
testified that the manual was reviewed before or during the vessel’s
reactivation in 1994 and that he was not aware of any indication in
the manual that the coupling needed maintenance. Ex. 4, excerpt of
Farman’s deposition, p. 23, 11. 21-24; p. 27, 11. 11-15; p. 172,
11. 17—p. 173, 1. 1; p. 181, 11. 13-19.
Defendants further observe that because this Court has previ-
ously dismissed Acomarit and Marine Atlantic Ltd. from this case,
there is no longer any claim involving crew members aboard the S/
T Marine Atlantic.
Defendants emphasize that there is no evidence of conscious
disregard of the coupling by the vessel’s crew. Even though Marine
Atlantic arranged for Saudi to depose the vessel’s master, chief of-
ficer, chief engineer, and crane operator, Saudi declined the oppor-
tunity.
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Defendants further highlight the absence of any evidence sup-
porting Saudi’s allegation that Marine Atlantic was negligent in not
requiring the breakdown and inspection of all moving parts of the
crane during the reactivation of the vessel by Keppel Shipyards in
Singapore in 1993. Nor does Saudi submit any evidence to support
his contention of intentional wrongdeing by MTL to support a claim
for punitive damages. Nor does he point to any authoritative source
(law, regulation, industry standard, or manufacturer’s recommen-
dation) that requires a compiete breakdown and inspection of the
crane in dispute.
Defendants assert that they demonstrated in their joint motion
to strike Plaintiff's experts (#220) that the “expert” testimony of Dr.
Mahmoud, ‘vho admitted that he was not present at the time the
ABS weight test was carried out in December 1998 and that he had
no knowledge whether the test documentation had been falsified, is
inadmissible; and that Dr. Mahmoud had no first-hand knowledge
of the test and his opinion was accordingly stricken by Magistrate
Judge Stacy. In contrast, the undisputed evidence and documenta-
tion in the case demonstrate that the weight test was performed. Ex.
5, ABS documentation of weight test.
As for Saudi’s contention that he is entitled to punitive damages
because Marine Atlantic Ltd. ‘s crew intentionally failed to monitor
the weight test properly to insure that was carried out, Defendants
note that again Saudi provides no supporting evidence. They also
claim that the assertion is false.
58a
Had Saudi taken the deposition of Captain Marcenaro, Marine
Atlantic’s master, Saudi would have discovered that Marcenaro did
attend the weight test in December 1998, saw the weights applied
to the crane and the crane lift the weights as the ABS survey and
shipyard representatives watched.’ Thus no factual basis supports
allegations of misconduct against Defendants.
After reviewing the record, the Court agrees that Saudi has
completely failed to meet his burden of proving intentional miscon-
duct, while Defendants have controverted his conclusory allega-
tions with evidence., Accordingly the Court denies the motion for
rehearing (#242) of its earlier order.
B. Instruments #244 and #260
1. Joe Alfred Izen, Jr. and Afton Jane Izen move for rehearing
or new trial (#244), with supplement (#254), on the Court’s Rule
54(b) final judgment, signed on December 19, 2000 (#230), award-
ing fees and expenses to Defendant U.S. Trust under
’ Defendants state that before Marine Atlantic Ltd. was dismissed from this
action, it was going to preserve Marcenaro’s testimony for trial through a de benne
esse deposition.
8 There are actually three orders underlying Saudi’s motion. In an order dated
September 5, 2000 (#159), the Court awarded U.S. Trust fees and expenses under 28
U.S.C. 1927 because it concluded that Saudi sued U.S. Trust without adequate
investigation and then subsequently unreasonably and vexatiously multiplied the
proceedings even after Defendant Marine Atlantic Ltd. admitted in pleadings filed in
this action that it owned the vessel in dispute at the relevant time. In its order entered
on December 19, 2000 (#229), based on a supporting affidavit submitted by U.S.
Trust, the Court ordered the Izens, responsible as Plaintiff’s counsel, jointly and
severally to pay U.S. Trust $28,601.78 for reasonable
toe aD.
ai. ee
59a
28 U.S.C. 1927, to be paid jointly by Plaintiff’s attorneys, for
unreasonably and vexatiously multiplying proceedings by refusing
to dismiss frivolous claims against U.S. Trust disproved by evidence
on file that Marine Atlantic Ltd. has owned the vessel since 1994,
including in May 1999, the time of Saudi’s injury. Saudi explains
that the Court agreed with U.S. Trust that Saudi’s claims against it
were based on its alleged ownership of the vessel when Saudi was
injured. Plaintiff points out that in support of Defendants’ joint mo-
tion to strike Plaintiff’s experts, Defendants had attached as Exhibit
3 the Expert Report of Robert Groesbeck, an ABS document that
lists U.S. Trust as the owner of the M/V Marine Atlantic from 1979
until 1994. Izens’ motion for rehearing or a new trial, Ex. A at p. 15.
The Izens also argue that Saudi’s c aims against U.S. Trust were not
limited to claims arising from U.S. Trust’s ownership or manage-
ment of the vessel at the time of Saudi’s injury. As a comparison,
they emphasize that the Court denied Defendants Marine Transport
Lines, Inc.’s and Marine Transport Corporation’s motions for sum-
mary judgment even though these Defendants never owned the vessel,
but merely supervised its refurbishment in 1994. The Izens ask the
Court to rehear the matter and to vacate its order of December 19,
2000
and necessary fees and $1,718.78 for necessary costs incurred by U.S. Trust_after
the Izens insisted on pursuing their claims despite the fact that evidence had been
filed disproving the basis of their claims against U.S. Trust. The Court then issued a
Rule 54(b) judgment in favor of U.S. Trust against Saudi on all claims (#230).
60a
awarding sanctions against them. The Court presumes that they
seek vacation of #229 and 230 also.
In a supplement (#254), the Izens attach an authenticating affi-
davit of Joe Alfred Izen Jr., a letter (Ex. A) from Innes Mackillop,
Defendants’ counsel, and business records of the transaction whereby
Shawmutt Bank Connecticut as “successor the United States Trust
Company of New York, not in its individual capacity but solely as
owner trustee under the trust agreement dated as of January 31,
1979,” transferred title of the vessel S/T Marine Atlantic to Marine
Atlantic, Ltd. Exhibits B-O. The Izens insist that there was no basis
in the record, nor any prior basis, for requiring them to guess that
the U.S. Trust Company involved in the ownership of the vessel
was a company other than U.S. Trust. Moreover, these records
“underscore the need which Plaintiff faced to take a deposition to
determine U.S. Trust’s powers (either exercised or retained) over
the vessel when U.S. Trust Co. of New York became ‘owner/
trustee.”” Izens’ motion at 2.
In response (#255), U.S. Trust objects that the Izens, in seek-
ing a rehearing, fail to allege or offer any new evidence that the
Court has not already considered and that their motion “is another
attempt to draw out Trust’s involvement in this lawsuit and force
Trust to waste more time and money responding to meritless mo-
tions.” Response at 2. U.S. Trust also points out that the motion
should be stricken because the Izens have not met
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their certificate-of-conference obligations.
U.S. Trust argues that the Izens have not established the admis-
sibility of the document entitled “Cargo Gear Certification and Test-
ing” of the vessel at issue, purportedly conducted by Robert P.
Groesbeck, which they keep attaching to their motions. See Ex. A
to #214 for fuii copy. It is not based on personal knowledge, nor is
it sworn to or even signed by Groesbeck, and is thus unauthenti-
cated hearsay. Moreover, the document was supposedly created
by an expert witness who has not been shown to be an expert.
Furthermore, contends U.S. Trust, even if it were admissible, it fails
to challenge the judgment. U.S. Trust reiterates that the evidence
filed with the court conclusively disproved the basis of the three
claims against them: two required U.S. Trust to have been the owner
of the vessel in May 1999, which the Izens still cannot show, and
the other claim required Trust to have been Saudi’s employer at that
time. Their motion does not contest the amount of the attorney’s
fees or costs awarded by the Court. Therefore U.S. Trust asks the
Court to affirm its judgment and deny the Izens’ motion.
U.S. Trust also contests the Izens’ claim that they never limited
Saudi’s potential claim against U.S. Trust to its ownership or man-
agement of the vessel at the time of Saudi’s injuries. The language of
the complaint reflects that the claims against U.S. Trust were only
filed against U.S. Trust as the owner of the vessel. Even if the Izens
had not so limited their
62a
negligence claims against U.S. Trust, the controlling law does, as
discussed in U.S. Trust’s motion for summary judgment, pp. 2-4,
and as the Court concluded.
Furthermore, the comparison of Saudi’s claims against U.S. Trust
with those against Marine Transport Corporation and Marine Trans-
port Lines, Inc. is inapposite, U.S. Trust maintains. Saudi submitted
some evidence that created a fact issue as to whether these other
Defendants refurbished or remanufactured the crane. No evidence
exists to raise a fact issue on Saudi’s claims against U.S. Trust. The
evidence that does exist, in contrast, disproves those claims, insists
U.S. Trust. Because the Izens’ conduct in failing to investigate their
claims before they filed them and in refusing to dismiss them once
contrary evidence was filed with the Court demonstrating that the
Izens had sued the wrong party resulted in the sanctions against
them, their motion for rehearing should be denied.
In a separate response (#257) to the Izens’ supplement, U.S.
Trust insists that the supplement lacks a certificate of conference,
misstates the law, contains an affidavit in which Joe Alfred Izen, Jr.
makes false statements (which U.S. Trust identifies), was filed four-
teen days after Rule 59’s ten-day deadline for new trial motions,”
attaches inadmissible exhibits,
' The Fifth Circuit, recognizing that Federal Rules of Civil Procedure 59 and 60
may be used to correct similar errors, applies a bright line rule: if the motion is served
within ten days following entry of judgment and challenges the correctness of that
judgment, it is treated as Rule 59 motion. An untimely Rule 59(e)
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63a
is irrelevant to the reasons why the Court imposed the sanctions,
and was filed without leave of court. U.S. Trust also complains that
the Izens filed the supplement on January 12, 2001 and then waited
until January 16, 2001 to mail a copy to U.S. Trust, in attempt to
prejudice its rights. U. S. Trust asks the Court to strike the supple-
ment from the record.
U.S. Trust further asserts that all the exhibits are inadmissible
hearsay that should be stricken. The Izens have not laid the proper
foundation for a business records exception. Moreover, the docu-
ments are incomplete and unreliable. It reiterates that the legal and
factual basis of the Court’s judgment remains unchallenged by any
competent evidence and should be affirmed, while the Izens’ mo-
tion for new trial should be denied.
In response (#260), the Izens disagree. Marine Transport Lines,
Inc. and Marine Transport Corporation’s response
motion is treated as a Rule 60 if the grounds asserted would support a Rule
60(b) motion. See, e.eq., Halicki v. Louisiana Casino Cruises, Inc., 151 F.3d 465, 470
(Sth Cir. 1998), cert. denied, 526 U.S. 1005 (1999) ; Goodman v. Lee, 988 F.2d 619,
623 n.2 (Sth Cir. 1993). Nevertheless, the grounds for relief asserted by Saudi must
be allowed under Rule 60(b). To succeed on a motion based on newly discovered
evidence, the movant must show that it exercised due diligence in obtaining the
information (and not evidence that could have been discovered and presented at trial
through the exercise of due diligence) and that the evidence is material and would have
clearly caused a different result had it been admitted previously. Government Finan-
cial Services One Ltd. Partnership v. Peyton Place, Inc., 62 F.3d 676 771, 774 (Sth
Cir. 1995). Furthermore that new evidence must have been is existence at the time of
the trial and only discovered after the trial. Id. at 771.
64a
(#261) in turn challenges the assertions made by the Izens about its
counsel as inaccurate. Instrument #261.
After reviewing the record, here, too, the Court finds the Izens’
motion to be meritlous and unsupported by any competent evidence.
Accordingly, the Court denies the motion for new tnal.
2. Ina related motion Defendant U.S. Trust’s seeks sanctions
and requests the Court to strike (#260) the Izens’ supplement to
motion for new trial (#254) and trial exhibit to their motion (#259).
Because the materials are for review solely by the Court, which
can disregard those submissions that are inadmissible, irrelevant,
frivolous, or factually incorrect, the Court denies the motion to strike.
C. Instrument #245
Plaintiff moves for rehearing (#245) on order signed on De-
cember 15, 2000 (#222) granting summary judgment to Defen-
dants Koch Shipping, Inc. and Koch Supply & Trading Company
Ltd. on all claims against them. Because the Court finds Plaintiff's
arguments to be redundant and without merit, and because it stands
behind its previous ruling, it denies the motion for rehearing.
D. Instrument # 246
Plaintiff moves for rehearing (#246) of the Court’s memoran-
dum and order dated December 21, 2000 (#237) dismissing
Se ees ee f
65a
Marine Atlantic Ltd. for lack of personal jurisdiction under both
Fed. R. of Civil P. 4(K)(2) and the Texas long-arm statute. Plaintiff
complains that when Robert Hamshaw appeared for his noticed
deposition on November 10, 2000, he failed to produce corporate
documents regarding his power to act on behalf of Marine Atlantic
Ltd. Moreover, his attorney stated that Hamshaw was appearing
“in his personal capacity” and was not to answer certain questions
regarding Monte Cristo Holdings .(““Monte Cristo’’), identified by
Plaintiff as the corporate owner of Marine Atlantic Ltd.), or Monte
Cristo’s shareholders. Plaintiff insists that Hamshaw “displayed an
alarming lack of recall which could be alleviated solely by placing
documents in front of him to refresh his memory.” #246 at p. 7.
After the deposition, Saudi moved to compel Hamshaw’s produc-
tion of certain documents under a subpoena. duces tecum.
Plaintiff then moved to compel resumption of the deposition,
but Judge Stacy upheld an objection by Marine Atlantic Ltd. After
reviewing the transcript of Hamshaw’s deposition, this Court found
that there was no basis for the exercise of personal jurisdiction.
Saudi argues that the Court should have compelled Hamshaw
to produce Marine Atlantic Ltd.’s records empowering Hamshaw
to act as its assistant secretary. Saudi asserts that Hamshaw stated
in his deposition that the records were in the hands of Monte Cristo’s
CEO, who allegedly offices in Bermuda.
66a
Saudi charges the Court with reversible error in limiting relevant
discovery. He also claims the Court erred by refusing to compel the
resumption of Hamshaw’s deposition. He objects to the Court’s
sealing of information reviewed by the Court in camera regarding
the financial ownership of Monte Cristo, and indirectly of the S/T
Marine Atlantic. He particularly emphasizes the failure of Defendant
to produce the closing binder for the original sale of the vessel in
1994 to Marine Atlantic Ltd. from whatever company owned it
previously.
~ Saudi further argues that Greg Doyle’s deposition'® shows the
Court has personal jurisdiction over Marine Atlantic Ltd. He claims
Marine Atlantic Ltd. acted through Doyle and his one-man corpo-
ration, Salisbury House, Inc. Ex. B, Doyle Dep., at pp. $1-53
(Hamshaw’s connection with Marine Atlantic Ltd. was as an assis-
tant secretary who once negotiated an agreement with Doyle and
Salisbury House, Inc.)."'
In response, Marine Atlantic Ltd. incorporates its original mo-
tion to dismiss for lack of personal jurisdiction (#162), its reply to
Saudi’s response to that motion (#177), and its response (#221) to
Saudi’s motion to compel resumption of Hamshaw’s deposition and
production of documents, in which it
'© Doyle had previously worked for Marine Transport Lines or M.T.L. Tank-
ers.
'' Although Plaintiff cites numerous other pages, the Court finds they are
irrelevant to its personal jurisdiction over Marine Atlantic Ltd.
67a
demonstrated that it does not do business in Texas and is not sub-
ject to either specific or general jurisdiction here. It also notes that
Saudi never perfected service of process on it. See Court’s Order
of August 31, 2000, entered Sept. 5, 2000 (#159)
In seeking rehearing of the personal jurisdiction issue, Saudi
relies on the excerpts of the depositions of Hamshaw and Doyle. In
its order of December 21, 2000 (#237), dismissing Marine Atlantic
Ltd., the Court stated that it had reviewed the transcript of
Hamshaw’s deposition. In the instant motion Saudi submits for the
first time extracts from Doyle’s deposition, which was taken on
November 30, 2000 and was available for submission to the Court
before it rule originally. Thus Doyle’s deposition is not “newly dis-
covered” evidence, argues Marine Atlantic, Ltd., and should not be
considered with the motion for rehearing. The Court agrees and
refers the parties to footnote 9 of this memorandum and order. Even
if the Court does consider the Doyle excerpts, Marine Atlantic main-
tains that the extracts do not prove the existence of contacts be-
tween Marine Atlantic Ltd. and the United States sufficient to sup-
port Rule 4(k)(2) jurisdiction.
Marine Atlantic Ltd., complaining of Saudi’s “factual inaccura-
cles, exaggerations and borderline libelous comments,””” also chal-
lenges Saudi’s version of the facts in his motion. At
'? As an example it points to Saudi’s completely unsupported accusation that
Julio Santo Domingo, “a Columbian gentleman... who owns controlling interest in
Monte Cristo,” was “engaged money-laundering of drug profits.”
68a
Hamshaw’s deposition, which was taken on November 10, 2000
by agreement, Marine Atlantic Ltd. quotes another agreement of
the parties reached during the deposition, Ex. 2 at p. 17, 1.17—>p.
18,1. 6.:
Mr. Nork"*: So we can agree, any questions you
want to ask, please ask. I’1l make the same objec-
tion I just made and I’]] ask madame court reporter
to certify this question o: make a mark on this ques-
tion. I think the most expeditious way to resolve
this is Mr. Hamshaw can furnish the answers later
to the best of his knowledge and we will furnish
them to the Court in camera so she can decide
whether they are relevant.
Mr. Izen: And they will be there for appeal. That’s
fine by me.
During the deposition Hamshaw declined to answer two ques-
tions: (1) “Who were the investors you were representing?” (Ex. 2
at p. 17, 11. 5-6); and (2) “Does (Julio Mario Santo Domingo]
have anything to do with financing vessels or any interest in any
vessels that you know of?” (Id. at p. 61, 11. 13-13). According to
the parties’ agreed procedure, the Court in camera reviewed an
affidavit filed by Hamshaw answering the questions and concluded
in its order of December 20, 2000 that there was no valid basis for 3
ordering resumption of his deposition or disclosure of the contents =
ot Hamshaw’s affidavit because the contents would not help Plain-
tiff demonstrate personal jurisdiction over Marine Atlantic Ltd.
is hon realtek oltre acs 0
Nor insists Marine Atlantic Ltd. did the Court commit
'S Counsel for Marine Atlantic Ltd.
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69a
irreversible error by refusing to order Hamshaw to produce the
documents Saudi seeks. Marine Atlantic Ltd. points out that the
deposition notice with a purported subpoena duces tecum, received
by Hamshaw on November 6, 2000, did not notice Hamshaw as a
corporate representative of Marine Atlantic. The Court’s order of
December 20, 2000 clearly stated, ‘““Hamshaw, who was not de-
posed as a corporate representative of any of the Defendants, can-
not be compelled to provided documents which are neither in his
possession nor under his control.” Thus the subpoena duces tecum
was. not enforceable. Marine Atlantic Ltd.-alternatively argues that
if Hamshaw was a party deponent, he had thirty days to respond to
the subpoena, which would have extended the production date be-
yond the discovery deadline. Furthermore, it notes, the majority of
the documents were first demanded in Saudi’s motion to compel on
December 1, 2000, the last day of discovery. The Court’s order on
December 20, 2000 stated, “To the extent Plaintiff seeks docu-
ments with the foregoing motion which were not identified in the
subpoena duces tecum to Hamshaw, such document requests come
too late, on the expiration of the discovery deadline.”
Furthermore, insists Marine Atlantic Ltd., Doyle’s deposition
transcript does not demonstrate that he was an agent of Marine
Atlantic Ltd. located in the United States. Outside of the single in-
stance when Doyle was involved in executing a contract between
Salisbury House and Marine Atlantic, Ltd, Saudi presents
70a
no evidence that any work by Doyle pursuant to that contract oc-
curred in the United States or that Doyle’s work under that con-
tract, if any, was other than work typically undertaken by an inde- -
pendent contractor. Saudi has presented no evidence of any agency
relationship between Doyle and Marine Atlantic Ltd. Although Saudi
tries to show, as a contact of Marine Atlantic Ltd. with the United
States, work performed by Doyle in negotiating shipyard contract
issues relating to the Marine Atlantic when Doyle was employed by
M.T.L. Tankers in Singapore, that work occurred years before Doyle
started Salisbury House, Inc. in Massachusetts. Ex. 3, Doyle Dep.
at p. 140, 11. 13-18; p. 141, 1. 7—p. 142, 1. 25; p. 44, 11. 6-10.
Doyle testified that when he negotiated the shipyard contract in.
Singapore, he did not have a contract with Marine Atlantic and that
he did not think he had specific authority to negotiate for Marine
Atlantic Ltd. Ex. 3, Dep. of Doyle, at p. 149, 1.15—p. 150, 1. 8.
Furthermore, that negotiation in Singapore occurred while Doyle
worked for a different company. Thus Saudi fails to show that Doyle
acted as an agent for Marine Atlantic Ltd. in the United States and
thus fails to support Rule 4(k)(2) jurisdiction.
After reviewing the record, the Court finds itself in complete
agreement with Marine Atlantic Ltd. and thus denies the motion for
rehearing.
E. Instrument #265
Plaintiff has filed cross motion for sanctions (#265) against U.S.
Trust. Because, as indicated above, the Court has rejected his ar-
guments in the above motions, and because the Court finds there
are numerous misrepresentations in that motion for sanctions, the
Court denies the cross motion for sanctions.
F. Instrument #266
Defendants Acomarit Services Maritimes S.A. (““Acomarit’),
Marine Atlantic Ltd., and Osprey Ship Management Inc-.’s motion
for entry of final judgment ..(#266.).) under Rule 54(b) states that it
is opposed, but no opposition has been filed. The Court has dis-
missed both Acomarit and Marine Atlantic Ltd. for lack of personal
jurisdiction. It has also, in two separate orders, granted Osprey
summary judgment on Plaintiff’s Jones Act, unseaworthiness, and
common-law and maritime negligence claims.
Because trial is imminent on the few remaining claims, and there-
fore a complete final judgment will issue in the near future, the Court
denies the motion.
In sum the Court
ORDERS the following:
(1) All Plaintiff's and the Izens’ motions for rehearing (#242,
244, 245, and 246) are DENIED;
(2) Plaintif?’s cross motion for sanctions (#265) is DENIED;
72a
(3) Defendants Acomarit Services Maritimes S.A.
(““Acomanit”), Marine Atlantic Ltd., and Osprey Ship
Management Inc.’s. motion for entry of final judg-
ment (#266) under Rule 54(b) is DENIED; (4)
Defendant U.S. Trust’s motion for sanctions and to
strike (#260) the Izens’ supplement to motion for
new trial and trial exhibit to their motion is DENIED
and (5) the Court hereby ADOPTS the magistrate..
judge’s memorandum and recommendation (#262)
as its own, OVERRULES Plaintiffs objections and
exceptions to #262, and GRANTS in large part
Defendants’ joint motion to strike (#220) Plaintiff's
expert witnesses, as indicated above and in the
magistrate’s memorandum and recommendation
(#262).
SIGNED at Houston, Texas, this 23 day of
July, 2001.
MELINDA HARMON
UNITED STATES DISTRICT JUDGE
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Appendix G
IN THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION
CIVIL ACTION NO. H-99-2367
CAPTAIN SHERIFF SAUDI,
Plaintiff
VS
S/T MARINE ATLANTIC, He Equipment and Appurtenances,
In Rem (a/k/a M/V Marine Atlantic, Her Equipment and Appur-
tenances, In Rem, a/k/a M/T Marine Atlantic, Her Equipment
and Appurtenances, In United States Courts Rem), MARINE
ATLANTIC, LTD., Southern District of JOHN DOE COM-
PANY, Owner ofthe Vessel Marine Atlantic, ACOMARIT
SERVICES MARITIMES, S.A., OSPREY ACOMARIT SHIP
MANAGEMENT, INC., VALMET- Michael N. Milby, Clerk
of Court APPLETON, INC., APPLETON MACHINES CO.
(Appleton Marine Division), APPLETON MACHINE CO.,
INC., APPLETOiv MARINE, INC., JOHN DOE COM-
PANY, Designer of the Crane, KOCH PETROLEUM GROUP,
L.P., JURONG SHIPYARD, LTD. AND UNITED STATES
TRUST COMPANY OF NEW YORK,
Defendants
MEMORANDUM AND ORDER
Pending before the Court in the above referenced admiralty
and maritime personal injury action, arising from the May 17, 1999
fall of Plaintiff Captain Sheriff Saudi (“‘Plaintiff’ or “Saudi’”’) from a
lifting basket as he was transferred from the tanker Marine Atlantic
to the M/V American Discovery because of the collapse of an al-
legedly defective portside crane on the tanker Marine Atlantic, is
Defendant Osprey Ship Management, Inc.’s
74a
(“Osprey’s’”’)' motion for summary judgment (#151).
The movant seeking a federal summary judgment initially must
inform the court of the basis for its motion and point out those por-
tions of the pleadings, depositions, answers to interrogatories, and
admissions on file that demonstrate the absence of a genuine issue
of material fact and show that it is entitled to a judgment as a matter
of law. Fed. R. Civ. P. 56(c); Celotex Corp. v. Catrett, 477 U.S.
317, 323 (1986). The movant need not negate the opposing party’s
claims nor produce evidence showing an absence of a genuine fac-
tual issue, but may rely on the absence of evidence to support es-
sential elements of opposing party’s claims. International Assoc. of
Machinists & Aerospace Workers, Lodge No. 2504 v. Interconti-
nental Mfq. Co., 812 F.2d 219, 222 (Sth Cir. 1987). The burden
then shifts to the non-movant to set forth specific facts and compe-
tent summary judgment evidence to raise a genuine issue of material
fact on each essential element of any claim on which it bears the
burden of proof at trial. Fed. R. Civ. P 56(c). The substantive law
governing the suit identifies the essential elements of the claims at
issue and therefore indicates which facts are material. Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The non-moving
party may not rest on mere allegations or denials in its pleadings, but
must produce affirmative evidence and specific facts. Anderson,
477 U.S. at 256-57. It meets this burden only if it shows that “a
reasonable
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jury could return a verdict for the non-moving party.” Id. at 254. A
mere scintilla of evidence will not preclude granting of a motion for —
summary judgment Id. at 252.
All reasonable inferences must be drawn in favor of the non-
moving party. Matsushita Electric Industrial Co., Ltd. v Zenith Ra-
dio Corp., 475 U.S. 574. 587-88 (1986), citing United States v.
Diebold, 369 U.S. 654, 655 (1962). Once the burden of proof has
shifted to the non-movant, he “must do more that simply show that
there is some metaphysical doubt as to the material facts.” Id. at
586. Instead he must produce evidence upon which a jury could
reasonably base a verdict in his favor. Anderson, 477 U.S. at 249.
“[T]here is no issue for trial unless there is sufficient evidence favor-
ing the nonmoving party for a jury to return a verdict for that party.
If the evidence is merely colorable, or is not significantly probative,
summary judgment may be granted.” Id., 477 U.S. at 249-50.
Moreover the non-movant must “go beyond the pleadings and by
his own affidavits or by depositions, answers to interrogatories and
admissions on file, designate specific facts that show there is a genuine
issue for trial.” Webb v. Cardiothoracic Surgery Assoc. of North
Texas, P.A., 139 F.3d 532, 536 (Sth Cir. 1998). Unsubstantiated
and subjective beliefs and opinions are not competent summary judg-
ment evidence. Forsyth v. Barr, 19 F.3d 1527, 1533 (5th Cir.),
cert. denied, 513 U.S. 871 (1994); Topalian v. Ehrman, 954 F.2d
1125, 1131 (Sth Cir.), cert. denied, 506 U.S. 825 (1992) . The
non-movant
76a
cannot discharge his burden by offering vague allegations and legal
conclusions. Salis v. Carpenter., 908 F.2d 299, 305 (Sth Cir. 1992);
Lujan v. National Wildlife Fed’n, 497 U.S. 871, 889 (1990).
Pleadings are not summary judgment evidence. Wallace v. Texas
Tech University, 80 F.3d 1042, 1046 (Sth Cir. 1996), citing Little v.
Liquid Air Corp., 37 F.3d 1069, 1075 (Sth Cir. 1994) (en banc.).
In his fourth amended complaint (#189), the controlling plead-
ing at this point, Plaintiff has sued osprey, along with employee,
Tom Garrett), as functioning I as the alleged manager charged with
acting through their common “general agent” and and/or operator
of the vessel, S/T Marine Atlantic, for general negligence under
maritime and common law.’ The fourth amended
? Plaintiff’s fourth amended complaint eliminated an earlier claim against Osprey
under the Jones Act. A seaman can only recover against his employer for causes of
action based on the Jones Act. Cosmopolitan Shipping v. McAllister, 337 U.S. 783,
791 (1949); Ex. E, Affidavit of William B. Gibbs. Saudi conceded that he was not an
employee of Osprey at the relevant time and thus the Jones Act claim was barred as
a matter of law. Relating to the claim for negligence under maritime law, only the M/
T Marine Atlantic’s owner, manager or operator can be liable for unseaworthiness of
the vessel. Daniels v. Florida Power & Light Co., 317 F.2d 41, 43 (Sth Cir. 1963) (to
be liable for breach of warranty of seaworthiness, a defendant “must be in the
relationship of an owner or operator of a vessel”), cert. denied, 375 U.S. 832 (1963);
Baker v. Raymond. Int’!, Inc., 656 F.2d 173, 181-82 (Sth Cir. 1981). The complaint
alleges that Osprey and Acomarit Services Maritimes, S.A. “are believed to have
managed and/or operated” the S/T Marine Atlantic “through their common agent and
employee, Tom Garrett.” The complaint’s third, fourth and fifth causes of action, for
breach of warranty of merchantability, strict liability in tort, and an action in rem
against the ship, respectively, are not complaint asserts that Tom Garrett entered
into an agreement with Acomarit Services Maritimes, S.A. under which Acomarit
Services Maritimes, S.A. would “reimburse” Osprey-Acomarit Ship Management,
Inc. for its payment of Garrett's salary.
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complaint asserts that Tom Garrtt entered into an agreement with
Acomarit Services Maritimes, S.A. under which Acomanrit Services
Maritimes, S.A would “reimburse” Osprey-Acomarit Ship Man-
agement, Inc. for its payment of Garrett’s salary.
Osprey moves for summary judgment on the general negligence
claims, which charge Osprey with breach of the duty to use reason-
able care and observe the standard of competence in the marine
industry in inadequately maintaining the ship and failure to make the
M/T Marine Atlantic a safe and seaworthy vessel. To prove negli-
gence under general maritime law, a plaintiff must demonstrate (1) a
duty owed to the plaintiff by the defendant; (2) breach of that duty;
(3) injury sustained by the plaintiff; and (4) a causal connection be-
tween the defendant’s conduct and the plaintiff’s injury. In re Coo-
per/T. Smith v. Gnots-Reserve, Inc., 929 F.2d 1073, 1077 (Sth
Cir. 1991). Under negligence law, a tortfeasor is
asserted against Osprey.
The fourth amended complaint also alleges, as a sixth cause of action, “a special
plea of res ipsa loquitur” against all Defendants. The doctrine, which is applied in
admiralty as well as tort, is not a rule of law, but purely a rule of circumstantial
evidence that aids an injured plaintiff in making a prima facie case permitting an
inference of negligence by the defendant to be drawn under specified circumstances,
i.e., the accident must be of a kind that ordinarily does not occur in the-absence of
someone’s negligence, it must be caused by an agency or instrumentality within the
exclusive control of the defendant, and it must not have been due to any voluntary
action or contribution on the part of the plaintiff. See, e.q., Curry v. Chevron USA,
779 F.2d 272, 275 (Sth Cir. 1985); Geotechnical Corp. of Del. v. Pure Oil Co., 196
F.2d 199, 205 (Sth Cir. 1952), cert. denied, 344 U.S. 874 (1952) ; Prosser on Torts
42 (1955). Thus it need not be pled as a separate cause of action in the complaint.
Dugas v. Kansas City Southern Ry. Lines, 473 F.2d 821, 825 (Sth Cir. 1973), cert.
denied, 414 U.S. 823 (1973).
78a
liable for breach of a duty only to those to whom it owes such a
duty. Consolidated Aluminum Corp. v. C.F. Bean Corp., 833 F.2d
65, 67 (Sth Cir. 1987). Osprey maintains that it was neither Plaintiff's
employer nor the M/V Marine Atlantic’s owner, taanager or opera-
tor, as evidenced by the affidavit (Ex. A) (“Captain Sheriff Saudi
was not an employee of Osprey Ship management, Inc. at the time
of the occurrence made the basis of the referenced case [May 17,
1999], nor at any other time.”’) and deposition (Ex. S, p. 81, 1.22
through p. 84, 1. 20) of Captain William B. Gibbs, President of
Osprey. Because Osprey was not Plaintiff's employer nor the owner,
manager or operator of the M/V Marine Atlantic, it owed no duty
to Plaintiff. Exs. A, Affidavit of William B. Gibbs, and B, Gibbs’
Dep. at p. 81, 1. 22—p. 84, 1.20. Saudi responds that there is a
fact issue as to whether Osprey, through its former employee, Tim
Garrett, managed or operated the fleet of Acomarit Maritime Ser-
vices,3 including the S/T Marine Atlantic, and therefore had the
responsibility to insure that the vessel was seaworthy and the portside
crane was properly maintained and not defective. Saudi suggests
that a clandestine relationship existed between Osprey and Acomanit.
Saudi claims
> Saudi represents that Acomarit, which was dismissed for lack of personal
jurisdiction, has admitted that it was the manager of the S/T Marine Atlantic. He
alleges that Acomarit and Osprey both employed Garrett as their general agent to
attend to Acomarit’s ships in ports in North and South America, including in the
United States. Saudi further alleges that Osprey entered into an agreement with
Acomarit by which Acomarit would “reimburse” Osprey for paying Garrett's sal-
ary.
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that American Automar owned Osprey Ship Management as a joint
venture with Acomarit Holdings, Ltd. and owned a majority of
Osprey’s stock. He alleges that Osprey agreed to take on Garrett
as Acomarit’s clandestine employee when the joint venture was
formed on June |, 1994. Ultimately, American Automar repurchased
all of Acomanit Holdings’ shares in Osprey and became the 100%
owner of Osprey. After detailing what Saudi characterizes as a se-
ries of “fraudulent nondisclosures and discovery abuse” by Osprey
and Acomarit, Plaintiff states that pursuant to a subpoena duces
tecum served on Osprey, a letter dated December 15, 1998 was
produced by Gibbs, written by Giorgio P. Sulser, Acomarit’s Group
Chief Executive, employed by Acomarit Services Maritimes, S.A.
The letter indicates that Garrett would provide “service to the
Acomarit group on a cost reimbursable basis plus an administrative
fee of $400 per month.” Affidavit of Joe Alfred Izen, Jr., Ex. B;
Dep. of Captain William Gibbs at p. 29, 11. 1-13, Ex. C. Saudi
also cites to the deposition of Captain Gibbs to show that Osprey
kept Garrett on the payroll and on its staffuntil March 1, 1999, less
than two months before Saudi’s injury, because Acomarit wanted
Osprey to do so, and that Acomarit basically had control over its
“clandestine employee.” Saudi maintains that Garrett attended‘
* “Attending” involves physical presence of the attending captain or port
captain on the vessel and includes such duties as assisting during major oil inspec-
tions, port stay control inspections, ISM internal audits, etc. Garrett Dep. at 65-66.
When he was attending, however, no one on the vessel would report to him because
he “had no authority or responsibility aboard the vessel.” Id. at 67.
80a
Acomarit’s ships while they were in United States ports according
to Acomarit’s instructions while Osprey “pretended” that Garrett
was Ospréy’s employee. Saudi asserts that under the law of implied
and apparent agency, if Garrett had the power or authority to con-
trol the management of the S/T Marine Atlantic for his principal and
secret employer, Acomarit, then co-employer Osprey is liable for
Garrett’s negligent acts or failure to act. Restatement (Second) of
Agency 7, B, BA,and 257; Inre Atlantic Financial Manage-
ment, Inc., 784 F.2d 29, 31-32 (1st Cir. 1986) (discussing liability
under agency theories of express or implied authority, apparent au-
thority, and respondeat superior), cert. denied sub nom. AZL Re-
sources, Inc. v. Margaret Hall Foundation, Inc., 481 U.S. 1072
(1987).° Saudi also alleges liability against Osprey under the doc-
trine of respondeat superior. Saudi claimed that he needed more
discovery to determine whether Osprey is liable for Saudi’s injuries
based on failure to warn, negligent maintenance of the crane, and/or
unseaworthiness.
In reply, Osprey emphasizes that uncontroverted evidence ex-
ists in the record that Osprey did not own, operate or manage the
vessel Marine Atlantic, which precludes the unseaworthiness claim,
and that Osprey did not owe any tort duty to Plaintiff, thereby elimi-
nating the negligence claim. Consolidated Aluminum Corp. v. C.F.
Bean Corp., 833 F.2d 65, 67 (Sth Cir. 1987)(‘‘a tortfeasor is
5 Osprey objects that this case deals with a Securities Act misrepresentation
and is not relevant here.
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accountable only to those to whom a duty is owed”), cert. denied,
486 U.S. 1055 (1988). No evidence exists to demonstrate that
Garrett served as the vessel’s operator or manager on behalf of
Osprey, insists Osprey. As Osprey argued in its motion, Gibbs clearly
testified during his deposition that Garrett had no duties with re-
spect to running Osprey’s business, did nothing for Osprey, did not
attend meetings of Osprey’s corporate directors, and did not vote
on any Osprey business. Gibbs further testified that Osprey Ship
Management Inc., before and after its name change,’ had no rela-
tionship with or operational or management responsibilities for the
vessel Marine Atlantic nor any ownership interest in the vessel. Nor
has Saudi presented any evidence of misrepresentation or negligent
conduct by Garrett or tortious conduct by Osprey to support his
agency theory. Because Saudi has offered no competent summary
judgment that Osprey or anyone acting on its behalf committed any
tort in this case, he has not raised any genuine issue of material fact
for trial. Those exhibits Saudi did submit do not controvert Osprey’s
evidence that it did not own, operate or manage the Marine Atlan-
tic.
Judge Stacy subsequently extended the discovery deadline to
December 21, 2000 to give Plaintiff an opportunity to try to obtain
employment records of and to depose Garrett. This Court
* Osprey Ship Management, Inc. was formed in January 1993. Through a
shareholder transaction in June 1994, it changed its name to Osprey-Acomarit. On
December 31, 1998 in another shareholder transaction it again became known by its
former name. Dep. of Captain William Gibson, President of Osprey, Ex. B at 81
(#151).
82a
thereafter ordered Plaintiff to respond to Osprey’s motion for sum-
mary judgment no later than December 27, 2000.
After taking Gairett’s deposition, Plaintiff filed a supplement to
his response (#243). Saudi points to parts of Garrett’s deposition
testimony that Saudi argues demonstrate that Garrett was an em-
ployee of osprey, paid by osprey, when he attended Acomarit-man-
aged vessels, including the Marine Atlantic, in ports in the United
States and elsewhere. Saudi argues that as Port Captain, Garrett
was responsible for insuring cargo safety and safe operation associ-
ated with cargo handling aboard the vessels he attended, which
included the Marine Atlantic. The evidence shows that Garrett vis-
ited the vessel Marine Atlantic three or four times and that he per-
formed a safety inspection and test of both cranes on the Marine
Atlantic in 1997. Saudi argues that based on the facts admitted by
Garrett, Osprey is liable for Garrett’s action under the Restatement
(Second) of Agency 7 8, 8a, and 257 and under the Restatement
(Second) of Torts 32 4(a), which provides that one undertaking an
act or duty, here inspection, must do so competently.
In a sur-reply (#248), osprey complains that the eighty-two,
separately numbered paragraphs in Saudi’s supplement do not re-
late to Osprey, circumvent the Court’s order of September 5, 2000,
at pp. 37-38 (#159), barring argument about Acomarit Services
Maritimes, S.A., impermissibly attempt again to introduce evidence
to support Saudi’s rejected claim that U.S. Trust Corporation owns
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the vessel, assert claims that are exclusively against Marine Trans-
port Lines, and, most significantly, fail to identify or implicitly raise a
genuine issue of material fact regarding Osprey’s alleged manage-
ment of the vessel. Saudi fails to adduce a single fact that shows that
Osprey owed a duty to Saudi or that Garrett’s activities in January
1997 legally or proximately caused the crane’s failure in May 1999.’
With regard to specific statements in the supplement, Os prey
inter alia points out that Saudi’s injury did not occur was the area of
Garrett’s supervisory job performance; instead it occurred after cargo
operations had been suspended. Ex. 1, excerpt from deposition
transcript of Saudi, p. 113, 1. 17 through p. 114, 1. 18. Garrett’s
admission that as port captain he oversaw cargo handling, loading,
discharging and safe operation regarding cargo
” Osprey quotes the Fifth Circuit in Donaghey v. Ocean Drilling & Exploration
Co., 974 F.2d 646, 649 (Sth Cir. 1992) :
Under the general maritime law, a party’s negligence is
actionable only if it is a “legal cause” of the plaintiff's injuries.
See Chavez v. Noble Drilling Corp., 567 F.2d 287, 289 (Sth Cir.
1978) _ “[L]egal cause is something more than ‘but for’ causa-
tion, and the negligence must be a ‘substantial factor’ in the
injury.” Thomas v. Express Boat Co., 759 F.2d 444, 448 (Sth
Cir. 1985) (citations omitted). The term “substantial factor”
means more than “but for the negligence, the harm would not
have resulted.” Spinks v. Chevron Oil Co., 507 F.2d 216, 223
(Sth Cir. 1975); see also Chisholm v. Sabine Towing & Transp.
Co., 679 F.2d 60, 63 (Sth Cir. 1982).
84a
handling does not establish that Osprey, through Garrett, had an
obligation to detect every deficiency in equipment aboard the ves-
sel, or that Osprey owed a duty to Saudi in May 1999 for a vetting
inspection like that Garrett participated in January 1997 on behalf
of oil majors, which were not time charterers of the vessel at the
time of the incident. Garrett never warranted his work io the oil
major on whose behalf the 1997 vetting inspection was done, never
warranted or certified the crane as meeting any particular standard,
and it was not his duty to do so since the oil major had its own
vetting inspector present. In the intervening two and one half years
between that inspection and the incident giving rise to this suit, many
things could have intervened and changed the crane’s condition.
Saudi has failed to provide proof of proximate cause to demon-
strate that Garrett’s actions in 1997, even if performed on behalf of
Osprey, were causally connected to the crane’s failure on May 17,
1999. Saudi has insinuated that Garrett was concealing Osprey’s
alleged link with Acomanit and the SIT Marine Atlantic in asserting,
“Despite the fact that he attended Acomarit managed vessels as
Port Captain on Csprey-Acomanrit time, while he was being paid as
Osprey’s employee, Garrett claamed Osprey-Acomarit had no con-
nection with the Marine Atlantic.” Osprey points out that Garrett’s
deposition testimony made clear that he worked “as an outside con-
sultant that attended vessels for a variety of reasons, and consulted
with the vessel’s staff to instruct them in oil major vetting proce-
dures, ISM systems
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etc., but that Osprey-Acomarit and Acomarit Services Maritimes
did not control or supervise that consulting work. Ex. 2, Garrett
Dep., pp. 312-13.
Sauc'l seems to be charging that, given Osprey’s history as a
joint ¥ enturer with Acomarit Services Maritimes,’ Acomarit Ser-
vices employed Garrett but arranged clandestinely for Osprey to
pay his wages a: its employee. Moreover, he argues that Osprey
through co-employee Garrett s actions as a port captain attending
vessels, including vessels owned by Acomarit entities around the
world, in essence also managed and operated those including the
M/V Marine Atlantic, and is thus liable to Saudi for negligence.
The Court has reviewed the record particularly Saudi’s supple-
ment and Garrett’s deposition testimony, in detail, to determine what
the evidence demonstrates regarding Garrett’s factual and legal re-
lationship to Acomarit Services Maritimes, Osprey, and Plaintiff. It
finds that the deposition testimony indicates the following.
Garrett worked for Osprey-Acomanit for almost five years from
May 1, 1994 until February 28, 1999. Garrett Dep. at pp. 119, 43.
During that time he acted mainly as an outside consultant for other
client companies. Id. at 33.-34. In that capacity he trained seamen
on other vessels, including some of the Acomarit
* Acomarit owned no vessels but was strictly a managing company managing
vessels owned by other Acomarit-reiated companies and attended by Garrett on
Acomarit’s behalf. Garrett Dep. at 88.
86a
group,’ and performed general surveys, International Safety Man-
agement (“ISM”)'° audits, and attending during oil major vetting
inspections.'' Id. at 35-36. The audits were at the request of and
for the benefits of these outside companies, and not for the bene ft
of Osprey-Acomarit. Garrett Dep. at pp. 40-41.
In his job for Osprey-Acomarit he was classified as “Group
Port Captain,” the group being made up of Osprey-Acomarit and
other companies. Id. at 43, 108. As Group Port Captain his “re-
sponsibility was to oversee the cargo handling, loading, discharging
and safe operation associated with cargo handling.”
Id. at 25. He did not “physically handle the cargo” or load or
discharge cargo. Id. at 27.
Garrett was emphatic that “Osprey-Acomarit had nothing to
do with the management of the vessels that I attended [as Port Cap-
tain]. Osprey had nothing to do with the day-to-day operations or
the ISM system established aboard any of those vessels.” Id. at 87,
63. In particular, regarding the M/V Atlantic Marine, which he vis-
ited as Group Port Captain, Garrett stated that he knew its
* The Acomarit group included Acomarit Services Maritimes, Acomarit U.K.,
Acomarit Singapore, Acomarit Hellenic, and Acomarit Cypress.
'© 7SM is an international standard. As ISM audit reviews management proce-
dures aboard a vessel to determine whether those procedures comply with theve
standards. Id. at 39, 87.
'' Oil vetting inspections are made by oil companies of other entity's vessels.
Id. at 41. Garrett testified that he, himself, did not do the actual oil vetting inspec-
tions while he was employed by Osprey-Acomarit.
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F tion of the vessel. I attended for a very small period of time, at very
i irregular intervals, and was not involved in the direct superinten-
dency of the vessel.” Id. at 150.'* See also Id. at p. 219 (“Number
one, I never managed vessels for anyone while on Osprey-
Acomarit’s payroll. I never received a job description or a contract
from any of the people that I did consulting work with or for.”); Id.
at 224 (‘Bear in mind, my responsibilities in Acomanit evolved into
an outside consultancy-ship with various parties. So when I attended
vessels, I never had any responsibilities and authority aboard such
vessels.”’).
He was also clear that Acomarit Maritimes Services “owned no
vessels. It was strictly a management company” and managed the
'? Garrett testified that he visited the M/V Marine Atlantic three or four times.
Id. at 128-29. He testified, “Osprey-Acomarit had no role in the management or the
operation of the... Marine Atlantic.” Id. at }31. He recalled performing an ISM audit
for Acomarit Maritimes while he was an Osprey-Acomarit employee. Id, at 85. He
also described that once in the first quarter of 1997, because Exxon or Vela was
considering chartering the tanker, when he and a vetting inspector interested in cranes
performed operational control tests of vessel’s cranes, which were manufactured by
Appleton, and examined the cranes’ records and the operational manual, during the
vetting inspection. Id- at 127-29, 140-43. They operated the cranes in every mode
possible and found no “indication that there was anything wrong with the internal
mechanisms of that crane.” Id. at 141. He stated, “There was nothing with the cranes
aboard the Marine Atlantic that would have led me to believe that there was an
inherent flaw in that crane or those cranes.” Id.. at 127. Garrett represented that he
was working for Osprey-Acomarit during the 1997 oil vetting inspection of the M/
V Marine Atlantic, but that he was attending on behalf of Acomarit Services Maritimes.
Id. at 64-65.
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vessels that he attended on its behalf. Id. at 88. Moreover, he in-
sisted that although he was physically present on the vessels he at-
tended and assisted in various inspections, as noted he “had no
authority or responsibility aboard the vessel” or off the vessel and
no one on the vessel reported to him. Id. at 66-67. If he saw some-
thing on the vessel that needed to be corrected, he would report it
to the Vessel Master. Id. at 69-70." He testified, “You have to bear
in mind that through my tenure with Acomarit, I had no authority to
interrogate anyone, to make sure that the repairs were completed.
Basically, I took people at their word, or usually learned that things
were going slower than normal or they required more assistance.”
Id. at 119. See also Id. at 158 (With respect to the vessels that he
attended as Port Captain under his arrangement with Osprey
Acomanrit, as an employee, “I had no authority, whatsoever, to enter
into any contractual obligation on behalf of Osprey-Acomarit or
any of the companies.”’)
Garrett also clarified the fact that while he received payments
from Osprey-Acomarit, such rembursement came from the vessel
operator for which he acted as a consultant. Id. at 109. He ex-
plained,
During my employment with, J°m going to use the
term “Acomarit,” I worked fer a variety of
'? Asked what Garrett would do if the Vessel Master reported a problem to
Garrett, Garrett stated clearly that his role would be merely as a consultant, but that
the Vessel Master would have to “order[] any necessary parts, material or labor to fix
a problem” and report to his superior, the Marine Superintendent. Id. at 7071.
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people; and being that Acomarit had several Euro-
pean offices, clients such as Torm paid my services
through Acomant U.K. Limited to Acomarit Geneva
to Osprey Ship Management. So acting as a con-
' sultant, my time was apportioned to people outside
of Acomarit.
Id. at 157. When there were expenses, such as flying to the
area, hotel, car rental, purchase of publications and charts for the
benefit of the vessels he was attending, he was reimbursed after he
would inform the operator of the vessel, which would in turn notify
the local Acomarit office. The operator would reimburse Acomarit,
which in turn reimbursed him through Osprey Acomarit, which is-
sued him checks: “Osprey-Acomarit received notification to extend
me funds once expenses had been approved.” Id. at 159-62. He
analogized payments for his services:
Osprey, the Acomanrit group that I worked with,
consulting-wise, controlled some of my payments.
That’s the easiest way to explain it, because, let’s
say you have a company, okay, you need someone
to perform a specific operation, you understand that
Captain Saudi over there has an operating com-
pany and he has people he could, as you say, loan
to you, I would be loaning to you. Now Captain
Saudi, with his company, he is located in a different
area than I am, and there are very long, specific
requirements to fulfill the obligations under IRS and
several other things, you pay Captain Saudi, Cap-
tain Saudi pays the office that I work for, and I
eventually get my money.”
Id. at 162. He would be reimbursed electronically in his bank
account. Id. at 163. “Osprey-Acomarit would not have given me
funds had they not received them first.” Id. at 164.
90a
Despite these clear professions, Saudi attempts without suc-
cess to use Garrett’s deposition to argue that osprey is liable as a
manager/operator through Garrett’s activities.
In sum, the Court finds that the deposition testimony of Tom
Garrett does not support Saudi’s claims that Garrett’s activities as a
‘‘co-employee” of Acomarit Services Maritimes and Osprey should
impose unseaworthiness liability on Osprey as an operator or man-
ager of the M/V Atlantic. Nor has there been any evidence submit-
ted of misrepresentations or tortious conduct by Garrett in 1997 or
other times or that his attending inspections in 1997 proximately
caused Saudi’s injuries in 1999,
Thus this Court agrees with Osprey that Saudi has not pre-
sented competent summary judgment evidence raising a genuine
issue of material fact to support Saudi’s claims of negligence against
osprey and allegations that managed the SIT Marine Atlantic through
the activities of Garrett. Mere speculation will not defeat a motion
for summary judgment. This case is set for docket call on April 6,
2001. By now Saudi has had substantial time to obtain factual evi-
dence to support his conclusory allegations, but he has failed to
submit any to the Court. Therefore the Court
ORDERS that Osprey’s motion for summary judgment on the
negligence claims under common and maritime law against it is
SDE Stee Rin a LSS Is FS ES ES Sig Sait PIE CE RE ih thc tec hig ene i oes
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GRANTED.
SIGNED at Houston, Texas, this 19" day of February, 2001
MELINDA HARMON
UNITED STATES DISTRICT JUDGE
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92a
Appendix H
IN THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION
CIVIL ACTION NO. H-99-2367
CAPTAIN SHERIFF SAUDI, °
Plaintiff,
V.
S/T MARINE ATLANTIC, ET AL.,
Defendants.
MEMORANDUM AND RECOMMENDATION
Before the Magistrate Judge upon referral from the District Judge
is Defendants’ Joint Motion to Strike Plaintiff’s Experts Salah
Mahmoud and Sheriff Saudi (Document No. 220). Plaintiff has filed
a response to the motion (Document No. 252), to which Defen-
dants have filed a Reply (Document No. 253). Having considered
the parties’ submissions, the opinions and deposition testimony of
Salah Mahrnoud and Sheriff Saudi, and the reliability requirements
set forth in Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S.
579 (1993) and FED. R. EVID. 702, the Magistrate Judge REC-
OMMENDS, for the reasons set forth below, that Defendants’ Joint
Motion to Strike Plainti*f’s Experts Salah Mahmoud and Sheriff
Saudi (Document No. 220) be GRANTED.
Reliability Requirements
FED. R. Evan. 702 provides:
If scientific, technical, or other specialized
knowledge will assist the trier of fact to understand
the evidence or determine a fact in issue, a witnes ‘
qualified as an expert by knowledge, skill, experi-
ence, training, or education, may testify thereto in
the form of an opinion or otherwise, if (1) the testi-
mony is based upon sufficient facts or data; (2) the
«7 te
93a
testimony is the product of reliable principles and
methods; and (3) the witness has applied the prin-
ciples and methods reliably to the fact of the case.
In Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S.
579 (1993), the United States Supreme Court held that “‘scientific”
expert testimony must both reliable and relevant to be admissible.
In Kianho Tire Co., Ltd. v. Carmichael, 526 U.S. 137 (1999),
the Supreme Court extended the reliability and relevancy require-
ments to all expert witness testimony, regardless of whether the ex-
pert possesses “scientific, technical, or other specialized knowledge”.
Although relevancy issues are generally straightforward, reliability
issues are not. At its most basic, Daubert 5 reliability requirement
forecloses the admission of expert witness testimony when it is not
“supported by appropriate validation.” Daubert, 509 U.S. at 590.
In other words, the expert’s opinion must be grounded in more than
“unsupported speculation or subjective belief.” Curtis v. M&S Pe-
troleum, Inc., 174 F.3d 661, 668 (Sth Cir. 1999).
When scientific expert witness testimony is challenge for reli-
ability, four nonexclusive factors are generally considered: 1) whether
the theory or technique upon which the expert witness’ opinion is
based has been tested; 2) whether the theory or technique has been
subjected to peer review and publication; 3) whether the theory or
technique has a known or potential rate of error; and 4) whether the
theory or technique has achieved “general acceptance” in the rel-
evant scientific community. Daubert, 509 at 593-595. When tech-
nical or other specialized knowledge forms the basis of an expert
witness’ opinion, the foregoing factors may or may not have any
applicability, and the district court will have to determine, on a case
by case basis, how to test the reliability of the expert’s opinions.
Kumho, 526 US. at 150-151.
Salah Mahmoud
Defendants seek to strike Salah Mahmoud as an expert in this
case on the basis that: 1) there is no data or reliable methodology to
support his opinion that an ABS survey of the crane
94a
in December 1998 could not have occurred or could not have oc-
curred as documented; 2) his opinion as to corrosion rate is unreli-
able because it is based on the assumption, which has no factual
support, that the crane at issue in this case was submerged in sea-
water; and 3) he. is not qualified as an expert in crane maintenance
and inspection, having no training or experience with applicable regu-
lations or industry standards for the maintenance and inspection of
cranes. Additionally, Defendants object to Mahmoud’s calculation
of the amount of corrosion on two spline gears (.21 to .25 inches),
because that calculation was not made by reference to the original
diameters of the gears, and because Mahmoud did not calibrate the
equipment he used to measure the spline gears.
Mahmoud’s opinion that an ABS survey of the crane could not
have been performed in December 1998 (or could not have been
performed as documented), and his opinion as to the corrosion rate
are opinions that are based insufficient facts and data. In addition,
given the insufficient facts and data to support the opinions, the opin-
ions are unreliable.
Mahmoud speculates that the ABS crane survey could not have
occurred in December 1998. According to Mahmoud, it is unthink-
able that the crane would have failed with a load of 200 pounds in
May 1999 if a load test of 50,000 pounds had actually been per-
formed on the crane in December 1998. Plaintiff, in response to
Defendants’ Joint Motion to Strike, posits that Mahmoud’s opinion
is supported by “common sense.” To the extent Mahmoud’s opin-
ion as to whether the ABS crane survey was actually conducted in
December 1998 is nothing more than “common sense’, expert tes-
timony is not needed. However, in addressing Defendants’ com-
plaints about the reliability of such a “common sense” opinion, it is
evident that Mahmoud’s opinion is pure speculation. Mahmoud was
not present at the time the ABS survey was to have
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occurred, and he has articulated no facts to support his specula-
tion that the survey could not have occurred. Moreover, Mahmoud
has not explained or supported his speculative opinion as to whether
the survey occurred with evidence that nothing else during the six
month period between the survey and the crane failure could have
led to or contributed to the failure. Because Mahmoud’s opinion
that the ABS survey of the crane in December 1998 either did not
occur or did not occur as documented is not supported by any facts
or data and is speculative, that opinion is not admissible under FED.
R. EVID. 702.
With respect to Mahmoud’s opinion as to the corrosion rate, as
has been shown by Defendants, and as 1s reflected in Mahmoud’s
deposition, Mahmoud’s opinion about the rate of corrosion is based
on his unsupported belief that the crane was submerged in saltwa-
ter. Neither Plaintiff nor Mahmoud has offered any evidence that
tie crane was in fact submerged in saltwater and was therefore
subject to a corrosion rate based on saltwater submersion. As such,
this opinion of Mahmoud is also based on insufficient facts and data,
and is therefore inadmissible under FED. R. EVID. 702.
With respect to Mahmoud’s opinions as to crane maintenance
and inspection requirements, Mahmoud’s deposition evidences that
he is not qualified to offer opinions on crane maintenance and in-
spection requirements. Mahmoud has no training or experience in
the inspection of cranes, and is generally unaware of the rules, regu-
lations and industry standards governing the maintenance and in-
spection of cranes. Accordingly, any opinion by Mahmoud as to
crane maintenance and inspection requirements is inadmissible un-
der FED. R. EVID. 702.
Finally, with respect to Mahmoud’s opinion of the amount of
corrosion of two spline gears, which he determined from the differ-
ence in the length of existing “teeth” on the gear and
96a
worn “teeth”, the undersigned concludes that while Mahmoud did
not calibrate the equipment he used, and did not know the original
diameter of the teeth, his calculations are simplistic and reliably evi-
dence the difference between the iength of the worn teeth and the
existing (or intact) teeth on the gears. As such, subject to a motion in
limine in which this issue may be revisited ait trial, Mahmoud’s opin-
ion as to the amount of corrosion on two spline gears should not, at
this stage, be disallowed.
Sheriff Saudi
Defendants seek to exclude the opinions of Plaintiff Sheriff Saudi
as to (1) the inspection of cranes; (2) the load testing of cranes; (3)
applicable standards, rules and regulations regarding crane inspec-
tions; (4) applicable standards, rules and regulations regarding load
testing; (5) applicable standards, rules and regulations regarding qua-
drennial inspection of cranes; (6) classification society standards for
the inspection of cranes, including those of the ABS, Det Norske
Veritas (“DNV”), and Lloyd’s of London, and (7) duties, responsi-
bilities and the standard of care applicable to the refurbishing of the
MARINE ATLANTIC. According to Defendants, Sheriff Saudi has
no training or experience relative to the inspection of cranes, and no
training, experience or practice knowledge of the rules, regulations
and industry standards for the inspection of cranes or the refurbish-
ing of vessels.
The undersigned has reviewed the deposition of Plaintiff Sheriff
Saudi provided by Defendants as an exhibit to their Joint Motion to
Strike. Saudi’s deposition testimony reveals conclusively that he has
no training e:,perience or personal knowledge which would qualify
him as an expert in crane inspection, load inspections, applicable
rules, regulations and industry standards for the inspection of cranes
and the refurbishment of vessels. The fact that Saudi is
97a
a captain with many years of experience as a master of vessels, a
mooring master pilot, and an instruction pilot does not suffice as
experience or training which would qualify Saudi to testify as an
expert in crane inspection and maintenance. Accordingly, the Mag-
istrate Judge recommends that Plaintiff Sheriff Saudi be disallowed
from testifying as an expert on the following topics: (1) the inspec-
tion of cranes; (2) the load testing of cranes; (3) applicable stan-
dards, rules and regulations regarding crane inspections; (4) appli-
cable standards, rules and regulations regarding load testing; (5)
applicable standards, rules and regulations regarding quadrennial
inspection of cranes; (6) classification society standards for the in-
spection of cranes, including those of the ABS, Det Norske Veritas
(“DNV”), and Lloyd’s of London, and (7) duties, responsibilitie.
and the standard of care applicable to the refurbishing of the MA-
RINE ATLANTIC.
Conclusion
Based on the foregoing and the conclusion from the parties’
submissions that certain opinions of Salah Mahmoud and Plaintiff
Sheriff Saudi are inadmissible under Fed. R. EVID. 702, the Mag-
istrate Judge
RECOMMENDS that Defendants’ Joint Motion to Strike
Plaintiff's Experts Salah Mahmoud and Sheriff Saudi (Document
No. 220) be GRANTED IN PART; that Salah Mahmoud be disal-
lowed from testifying about (1) whether the ABS crane survey in
December 1998 was performed or performed as documented; (2)
the corrosion rate; and (3) crane maintenance and inspection re-
quirements; and that Plaintiff Sheriff Saudi be disallowed from of-
fering any expert opinion testimony cn (1) the inspection of cranes;
(2) the load testing of cranes; (3) applicable standards, rules and
regulations regarding crane inspections; (4) applicable
98a
standards, rules and regulations regarding load testing; (5) appli-
cable standards, rules and regulat:ons regarding quadrennial inspec-
tion of cranes; (6) classification society standards for the inspection
of cranes, including those of the ABS, Det Norske Veritas (““DNV”’),
and Lloyd’s of London, and (7) duties, responsibilities and the stan-
dard of care applicable to the refurbishing of the MARINE AT-
LANTIC.
The Clerk shall file this instrument and provide a copy to all
counsel and unrepresented parties of record. Within 10 days after
being served with a copy, any party may file written objections pur-
suant to 28 U.S.C. § 636(b)(1)(C), FED. R.. Civ..P. 72(b), and
General Order 805, S.D. Texas. Failure to file objections within
such period shall bar an aggrieved party from attacking factual find-
ings on appeal. Thomas v. Avn, 474 U.S. 140 (1985); Ware v.
King, 694 F.2d 89 (Sth Cir. 1982), cent. denied, 461 U.S. 930
(1983); Nettles v. Wainwright, 677 F.2d 404 (Sth Cir. 1982) (en
bane). Moreover, absent plain error, failure to file objections within
the ten day period bars an aggrieved party from attacking conclu-
sions of law on appeal. Thomas v. Arn, 474 U.S. 140 (1985); Ware
v. King, 694 F.2d 89 (Sth Cir. 1982), cert. denied, 461 U.S. 930
(1983): Nettles v. Wainwright, 677 F.2d 404 (Sth Cir. 1982) (en
banc). Moreover, absent plain error, failure to file objections within
the ten day period bars an aggrieved party from attacking conclu-
sions of law on appeal. Douglass v. United Services Automobile
Association, 79 F.3d 1415, 1429 (Sth Cir. 1996). The original of
any written objections shall be filed with the United States District
Clerk, P.O. Box 61010, Houston, Texas 77208.
Signed at Houston, Texas, this 26" day of January, 2001.
FRANCES H. STACY
UNITED STATES MAGISTRATE JUDGE
99a
Appendix I
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
CIVIL ACTION NO. H-99-2367
CAPTAIN SHERIFF SAUDI,
Plainuff,
V.
S/T MARINE ATLANTIC, ET AL.,
Defendants.
ORDER
if Defendants’ Joint Motion to Strike Plaintiff’s Experts Salah
| Mahmoud and Sheriff Saudi (Document No. 220) has been re-
ferred to the undersigned. A written response to that motion, pursu-
ant to the Local Rules of this District, is due on or before January 4,
2001. Ina letter to the Court dated December 21, 2000, Plaintiff’s
counsel asked that the Joint Motion to Strike be stricken because it
did not contain a certificate of conference. Additionally, in that let-
ter, Plaintiff's counsel asked to be afforded the twenty day response
time provided for by the Local Rules prior to a hearing being held
on the motion. The twenty day response time provided for by the
Local Rules applies to the Joint Motion to Strike, and for purposes
of clarity as well as to obviate the need to address any requested
extensions of that response deadline, undersigned advises Plaintitf
that his response tc the Joint Motion to Strike must be filed on or
before January 8, 2001, or such response will not be considered.
Signed at Houston, Texas, this 3% day of January 2001.
FRANCES H. STACY
UNITED STATES MAGISTRATE JUDGE
100a
Appendix J
IN THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION
CIVIL ACTION NO. H-99-2367
CAPTAIN SHERIFF SAUDI,
Plainuff
VS.
S/T [MARINE ATLANTIC, Her Equipment and Appurte-
nances, In Rem (a/k/a M/V Marine Atlantic, Her Equipment
and Appurtenances, In Rem, a/k/a M/T Marine Atlantic, Her
Equipment and Appurtenances, In Rem), MARINE ATLAN-
TIC, LTD., JOHN DOE COMPANY, Owner of the Vessel
Marine Atlantic, SACOMARIT SERVICES MARITIMES, S
.A., OSPREY ACOMARIT SHIP ENTERED MANAGE-
MENT, INC., VALMET- APPLETON, INC., APPLETON
MACHINE CO. (Appleton Marine Division), APPLETON
MACHINE CO.,INC., Michael N. Milby, Clerk
APPLETON MARINE, INC., JOHN DOE COMPANY,
Designer of the Crane, KOCH PETROLEUM GROUP, L.P.,
JURONG SHIPYARD, LTD. AND UNITED STATES TRUST
COMPANY OF NEW YORK,
Defendants
MEMCRANDUM AND ORDER
Pending before the Court in the above referenced admiralty
and maritime personal injury action, arisimg from the May 17, 1999
fall. of Plaintiff Captain Sheriff Saudi (“Plaintiff’ or “Saudi’’) from a
lifting basket as he was transferred from the tanker Marine Atlantic
to the M/V American Discovery because of tie collapse of an al-
legedly defective portside crane on the tanker’ farine Atlantic, is
inter alia Defendant Marine Atlantic Ltd.’s opposed motion to dis-
mis3 for lack of personal jurisdiction (#162) .
10la
With a supporting affidavit (#164) from its Director and Vice
President Arthur Jones, Defendant Marine Atlantic Ltd. argues that
this Court lacks personal jurisdiction over it.' First, its
' Federal Rule of Civil Procedure 4(e) permits a district court to assert personal
jurisdiction over a nonresident in a diversity action to the extent allowed under the
law of the state where the district court sits. A Texas court has personal jurisdiction
under the Texas long-arm statute over a foreign defendant that “does business” in
Texas. i.e., that (1) contracts by mail or otherwise with a Texas resident and either
party is to perform the contract in Texas; (2) commits a tort in whole or in part in this
state; or (3) recruits Texas residents, directly or through an intermediary located in
this state, for employment inside or outside of Texas. Tex. C’v. Prac. & Rem. Code
17.042.045 (West 1999). The Texas Supreme Court has interpreted the language of
its long-arm statute to reach as far as the federal constitutional requirements of due
process will allow. Schlobohm v. Schapiro, 784 S.W.2d 355, 357 (Tex. 1990). Thus
the Court examines the due process requirements.
A party’s liberty interest under the fourteenth amendment protects it from
being subjected to binding judgments of a forum with which it has established ne
meaningful contacts, ties or relations.”’ Guidry v. U.S. Tobacco Co., Inc., 188 F.3d
619, 623 (Sth Cir. 1999), quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462,
472 (1985), and International Shoe v. Washington, 326 U.S. 310, 319 (1945). The
due process clause requires that a foreign defendant have “minimum contacts” with
the forum state so that the maintenance of a suit does not offend “traditional notions
of fair play and substantial justice.” Id., citing International Shoe, 326 U.S. at 316.
For minimum contacts, a nonresident defendant must have purposefully availed
himself of the privilege of conducting activities within the forum state, thereby
invoking the benefits and protections of its laws. Gardemal v. Westin Hotel Co., 186
F.3d 588, 595 (Sth Cir. 1999).
Where a nonresident defendant has sufficient “continuous
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